Air France-KLM said on Friday it was awaiting with "expectation" a new round of negotiations announced by the Portuguese government for the purchase of 44.9% of TAP Air Portugal, a process in which Germany's Lufthansa is its rival bidder.
In a statement sent to the Lusa news agency, Air France-KLM said it had taken note of the Portuguese government's decision to move to an additional round in TAP's privatization process. The group said its continued participation in this phase reflected its unchanged interest in TAP, and that it awaited the next phase of the process with expectation.
Air France-KLM said its proposal includes a strategic plan covering all areas of the business, including passenger transport, cargo, loyalty programmes and Maintenance, Repair and Overhaul, known in the industry as MRO. It added that Delta Air Lines, its joint-venture partner, supports and is aligned with the proposal.
Air France-KLM is the Franco-Dutch group that owns France's flag carrier Air France and the Netherlands' KLM Royal Dutch Airlines. Lufthansa is Germany's largest airline group. TAP is Portugal's national flag carrier. Delta Air Lines is a major United States airline that operates a long-standing transatlantic joint venture with Air France-KLM.
Government to negotiate with both bidders
The Portuguese government will begin final negotiations with the two candidates that submitted binding offers for the 44.9% stake in TAP, Air France-KLM and Lufthansa, the minister of the Presidency, Leitão Amaro, announced on Friday.
Leitão Amaro said the offers, while different, carry a very close overall evaluation, which justifies the effort to negotiate with both competitors. The goal, he said, is to obtain improved proposals so that the government can eventually choose a single bidder for what he called the very final stage of negotiation.
On 1 September, the state holding company Parpública delivered its report on the two binding offers to the government for analysis. The privatization process provides for the sale of up to 49.9% of TAP's capital, of which 5% is reserved for the airline's workers. Any portion of that 5% not taken up by employees could be acquired by the selected investor under a right of first refusal.
Leitão Amaro said the proposals are globally so close that the best course of action for the national interest is to hold an additional, final phase of negotiation with both candidates. That final negotiation period with the two competitors is expected to last a few weeks.
TAP's first-half loss
Asked about TAP's results for the first half of the year, in which the airline posted a loss of 99.2 million euros blamed on fuel prices, Leitão Amaro chose to highlight what he described as historically high sales, among the highest on record for the carrier over the same period.
He said evaluations naturally take into account this kind of circumstantial factor alongside structural trends, particularly the expansion of sales and of the business.
Leitão Amaro acknowledged that the price offered for TAP is naturally an important criterion, but not the only one, since the terms of the privatization require an overall assessment of the offers that also weighs factors such as routes and the industrial project behind each bid.
