The government of Portugal will approve a plan to privatise TAP Air Portugal (TP, Lisbon) at a cabinet meeting set for September 28, before a discussion on the state budget, Prime Minister Antonio Costa announced this week.

“As the European Commission recognises, we are implementing the restructuring plan successfully, and I can confirm that next week we will approve the diploma that establishes the framework for the privatisation of TAP, defending the company and the interests of Portugal and the Portuguese,” he declared in parliament on the afternoon of September 19, as quoted by the Lusa News Agency.

The government had already said in July that it would kickstart the sale with a decree to be published by October, having previously delayed the process by several months. Costa said in March that the government intended to retain a minority “strategic” stake in the airline, which is undergoing restructuring under an EU-approved EUR3.2 billion euro (USD3.43 billion) rescue plan.

Three major European players - Air France-KLM, (Iberia and British Airways owner) IAG International Airlines Group, and Lufthansa Group - have all shown an interest in buying TAP, whose chief attraction lies in its links to Brazil - of which it is the biggest European provider - as well as a strong presence in Africa. The privatisation process is expected to be concluded in the first half of 2024.

Last week, a committee of Brazil’s Chamber of Deputies discussed the possibility of the country entering TAP’s shareholder structure when a deputy from the ruling Workers’ Party, Washington Quaquá, argued that Brazil should “acquire a piece through its national resources” together with European or Portuguese partners so that it can “build with the Portuguese state a shareholder solution to control TAP” and serve Brazilian interests.

In his address to parliament, Costa pointed to the 7.58 million passengers it carried in the first half of 2023, a 30% increase from a year ago, a figure representing 96% of its traffic in the same period of pre-pandemic 2019. TAP swung to a net profit of EUR23 million (USD24.7 million) during the half-year, fuelled by booming tourism.