A resolution by the Council of Ministers has been approved, establishing the terms and conditions for the reprivatization of the social capital of TAP – Transportes Aéreos Portugueses, S.A., through the approval of the respective terms of reference, as confirmed without additional details.
The decree-law for TAP’s privatization, published in August, anticipates that the private investor may acquire more than 44.9% of the company by purchasing shares not bought by employees out of the 5% reserved for them.
The government previously announced that this reprivatization could reach 49.9% of TAP’s social capital through a direct sale of up to 44.9% of the company’s social capital to a reference investor and a disposal of up to 5% of capital to the group’s employees.
The decree-law states that this strategy will ensure the protection of significant public interests and, with an eye toward the future, optimize TAP’s valuation potential, considering a possible future sale of the remaining State-held stake, which would necessarily include a premium on exclusive control.
The selection criteria for interested parties include the necessity to submit an industrial plan and a strategic project aligning with the objectives set for the reprivatization process, particularly concerning the headquarters and main establishment of TAP, ensuring strategic routes.
An additional selection criterion for advancing to subsequent stages of the direct sell-off process involves commitments regarding labor issues, specifically the express adherence to comply, in legal and constitutional terms, with TAP employees’ rights, as well as respect for all existing collective labor regulation instruments.
Regarding future rights, the document states that the Council of Ministers may grant the reference investor preemptive rights and/or first offer rights on future disposals of shares held or controlled by the State. These rights could also extend to joint sale rights for the reference investor over future State-held share disposals and similar preemptive rights or first offer rights in favor of the State on future sales of TAP shares held or controlled by the reference investor.
The sale may be organized in one or more stages, potentially including a compliance verification phase for interested parties, a phase for submitting non-binding acquisition proposals, another for binding proposals, and one for negotiation.
Up to the physical settlement of share purchases and sales, the Council of Ministers reserves the right to suspend or terminate the reprivatization process at any time for public interest reasons, without entitling any interested party or bidder to any indemnity or compensation.
