European airlines lay groundwork for potential bids for Portugal's TAP

At least three European airlines are laying the groundwork for potential bids for Portugal's flag carrier TAP, sounding out local communications agencies and legal advisers as a new CEO prepares to take over, according to sources and media reports. The state owns 100% of TAP, which is currently restructuring under a Brussels-approved 3.2 billion euro ($3.5 billion) rescue plan, and the government is considering an outright or partial sale of the airline.

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Finance Minister Fernando Medina said in February the government was doing preliminary work for the privatisation process. Lufthansa, Air France-KLM, and British Airways owner IAG are seen as potential buyers. Air France-KLM declined to comment. IAG and Lufthansa did not immediately respond to requests for comment. Portuguese news site ECO reported on Thursday that IAG, which also owns Iberia, had selected communications agency Cunha Vaz & Associados (CVA) and lawyers' office Vieira de Almeida (VdA).

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CVA and VdA did not immediately reply to requests for comment. A source from a large Lisbon law firm, who declined to be named, said Air France-KLM and Lufthansa were also "sounding out" legal and communications advisers in Portugal. A communications agency source said the three airlines were likely to officially select Portugal-based advisers soon. Another communications agency source said there were ongoing talks between the main advisory agencies and the three airlines, adding: "The process is really kicking off." A spokesperson for the finance ministry, which is in charge of the privatisation, declined to comment on when the process would formally start. The government fired TAP's CEO Christine Ourmières-Widener last month in the wake of a scandal involving an irregular severance payment. Luis Rodrigues, current chief of Azores regional airline SATA, will take over as TAP's CEO and chairman on Friday, the finance ministry said.

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Source: Reuters

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