Portugal’s President, Marcelo Rebelo Sousa, signed a government decree on Thursday concerning the privatization of TAP, but not before seeking clarification from Prime Minister Luís Montenegro’s administration.
Marcelo Rebelo Sousa raised questions regarding the interpretation of certain clauses, especially concerning potential operations involving TAP’s assets, changes in the capital structure in the context of the tender, and issues related to the insolvency of TAP SGPS.
The televised announcement was made shortly before the President confirmed his authorization: “Following governmental clarifications, the President of the Republic promulgated the decree that approves the reprivatization process of the share capital of TAP – Transportes Aéreos Portugueses, S.A.,” as indicated in a statement on the Presidential website.
It is noteworthy that in October 2023, Marcelo Rebelo de Sousa had vetoed the document prepared by António Costa’s government to initiate TAP’s privatization.
At that time, the President sent back the decree, which was approved in a Council of Ministers meeting on September 28 of that year, as it raised “multiple doubts and reservations in light of the desired maximum transparency of the process.”
The Judicial Court of the Lisbon Region today declared the insolvency of Siavilo SGPS, the former TAP SGPS, requested by TAP SA, according to documents published in Citius.
What follows?
Following the President’s enactment of the decree-law and the approval of the terms of reference, the pre-qualification phase for interested parties will extend for 60 days.
According to the proposed model, the State will initially proceed with the direct sale of up to 49.9% of the company’s capital, of which 5% will be reserved for employees, as mandated by the Privatization Law. Should this tranche not be fully subscribed, the buyer will have a preference over the remainder.
The reprivatization process officially began on July 10 with the approval of the decree-law outlining the operation’s terms. The subsequent step is the approval of the terms of reference, which will specify the technical, legal, and administrative criteria of the sale.
In addition to TAP, the process involves assets such as Portugália, the company’s healthcare unit, Cateringpor (51% owned by TAP), and SPdH, formerly Groundforce. The inclusion of real estate assets known as the “TAP complex,” adjacent to Lisbon airport, remains undecided, with its integration being considered for the upcoming “Parque Cidades do Tejo” project.
The government aims to complete the four stages of the operation within a year, although the schedule is subject to regulatory approvals. Parpública will be responsible for reviewing proposals and drafting the technical report to be submitted to the Council of Ministers.
European groups expressing interest in the process include Lufthansa, Air France-KLM, and the International Airlines Group (IAG), which controls Iberia and British Airways.
