Air France-KLM and Lufthansa Compete to Acquire TAP Air Portugal

Air France-KLM and Lufthansa have submitted non-binding bids for a minority stake in TAP Air Portugal, the national flag carrier of Portugal. According to reporting from Reuters, these two airlines were the only entities to submit proposals by the April 2, 2026, deadline. IAG, the owner of British Airways, opted not to participate in the bidding process.

The Portuguese government is seeking to privatize a 49.9% stake in the airline. This offering is divided into a 44.9% stake reserved for a strategic airline investor and a 5% stake reserved for the company’s employees.

While the current sale leaves the Portuguese state in control with a 50.1% stake, the government has indicated it is open to selling the remaining shares to the same buyer at a future date. This potential for full ownership has positioned the acquisition as a significant strategic opportunity for Europe’s largest airline groups.

Air France-KLM Strategic Objectives

Air France-KLM was the first bidder to formally confirm its proposal to acquire a minority stake. In a statement released on April 2, 2026, the Franco-Dutch group highlighted its extensive experience working with state shareholders as a key qualification for the partnership.

The group’s primary strategic interest lies in the geographical advantages of Lisbon. Air France-KLM stated that Lisbon could serve as its only hub in southern Europe, providing expanded connectivity to Africa and the Americas. The company specifically identified Brazil as a key market for both TAP and the Air France-KLM group.

Benjamin Smith, the executive chairman of Air France-KLM, addressed political concerns regarding the sale, particularly those involving the maintenance of the airline’s operational center in Lisbon. Smith stated that the company’s ambition is to strengthen operations in Lisbon while also developing connectivity in other Portuguese cities, including Porto.

We believe that this partnership experience is a testimony to the strategic importance of aviation for a nation.

Air France-KLM statement

The company further noted that it favours cooperation within a clear framework designed to maximise economic and operational synergies as part of its bid for the carrier.

Market Context and Competition

The bidding process for TAP Air Portugal has transitioned from a phase of political positioning and broad interest into concrete financial offers. The entry of both Lufthansa and Air France-KLM indicates a competitive race for one of the continent’s most strategically positioned carriers.

The withdrawal of IAG from the process has narrowed the field to two of Europe’s most powerful aviation consortia. The Portuguese government had previously expected to receive three bids before the April 2, 2026, deadline.

The strategic value of TAP is largely attributed to its established routes to South America and Africa, which offer the winning bidder a strengthened foothold in those regions. For Air France-KLM, the acquisition is viewed as a method to seize the initiative before rivals can define the competitive landscape in Southern Europe.