Portuguese government seeks opposition backing for sale of rest of TAP, minister says

Portuguese Government Seeks Support to Complete TAP Privatisation with Lufthansa

Key Developments in TAP Privatisation and Political Response

Government's Plan to Sell TAP Stake

LISBON, Oct 15 (Reuters) - The Portuguese government is seeking opposition support to sell the state's remaining 50.1% stake in flag carrier TAP to Lufthansa for €1.351 billion ($1.52 billion), Finance Minister Joaquim Miranda Sarmento said.

The government on Wednesday picked Lufthansa's €1.2 billion bid for up to 49.9% of TAP, and its offer for the remaining shares in exchange for €863 million in cash and a 5% stake in the Lufthansa Group, would complete TAP's privatisation.

Benefits and Economic Impact

Government Perspective on the Deal

Sarmento told state broadcaster RTP late on Wednesday that the German airline's proposal, which the minority centre-right government supports, would benefit both the flag carrier and Portugal's economy.

According to a government presentation, the second phase of TAP's privatisation proposed by Lufthansa, which values the 5% stake at €488 million, could take place by mid-2028.

Political Challenges and Opposition Views

The government, which had to secure opposition backing in parliament for this week's deal with Lufthansa, will need its support again for the privatisation's second phase, Sarmento said.

"We will assess the second phase, but this is an extraordinary opportunity for both the company and the country that Portugal cannot afford to miss," he said.

The opposition Socialist Party said it was premature for the government to be talking about a full privatisation of TAP, while far-right Chega said it would first review the terms of any second-stage sale.

Strategic Implications for Portugal and Lufthansa

Lufthansa's Growth Plans for TAP

Shareholding and Economic Advantages

The minister said the 5% stake would make Portugal the Lufthansa Group's second-largest shareholder and that Lufthansa's growth plans for TAP would bring "many more employees, much more activity, much higher revenues" and "far greater benefits" to Portugal's economy.

The deal, he said, "would directly affect investment, employment, productivity and economic growth."

($1 = 0.8913 euros)

(Reporting by Sergio Goncalves; Editing by Tomasz Janowski)