Lufthansa invests in TAP

The Portuguese government selected Lufthansa Group on 14 October 2026 to acquire 44.9% of TAP Air Portugal, choosing it over Air France-KLM at the end of a privatisation process in which both had submitted improved final bids in September. Lufthansa offered 1.025 billion euros for that stake, around 16% above the competing bid, with a further 118 million euros for a 5% tranche reserved for the airline’s 9,000 employees at the same price, any unsold shares reverting to Lufthansa. The total consideration of 1.201 billion euros valued the whole of TAP at an enterprise value of €4.5bn. The Portuguese state retained 50.1%. TAP carried 16.7 million passengers and posted a net profit of 4.1 million euros in its last full year, but recorded a loss of 99.2 million euros over the first half of 2026, 40% worse than a year earlier, as fuel costs rose. The attraction for Lufthansa lay in TAP’s Lisbon hub and its route network, which covers fourteen Brazilian cities alongside Portuguese-speaking Africa and North America, connections that none of its existing hubs in Frankfurt, Munich, Zurich, Vienna, Brussels and Rome provides. The government assessed the bids on more than price, weighing each bidder’s industrial plan, its commitment to Lisbon as a hub and to the airports of Porto, Faro, the Azores and Madeira, and to skilled employment in Portugal. Lufthansa committed to investments including a pilot training school at Tancos, an innovation centre in Aveiro and a corporate services centre. Lufthansa also tabled an offer for the remaining 50.1%, at 863 million euros plus a 5% holding in Lufthansa Group, which the state said it was prepared to consider, with full privatisation possible by 2028. IAG had withdrawn from the process after failing to obtain assurances that it could eventually take control. Completion required European Union merger clearance and was not expected to close legally before 2028.