Air France-KLM has submitted its expression of interest in the TAP privatisation process to state company Parpública, ahead of the deadline set for this Saturday (November 22).
In a statement, the Franco-Dutch group said that the step “demonstrates once again its strong and continued interest” in the operation, and that it is “looking forward to the next steps” in the process.
Portugal’s AD government plans to sell up to 44.9% of the airline’s capital, reserving 5% for the employees, as stipulated by the Privatisation Law. If this tranche is not fully subscribed (which is more than likely), the future buyer will have pre-emptive rights.
As of November 22, Parpública, the company that manages the state’s shareholdings, has 20 days (until December 12) to submit a report to the government describing the interested parties who have expressed an interest and assessing their compliance with the participation requirements.
Within 20 days of the report being made available, interested parties who have demonstrated that they fulfil the requirements will be invited to submit a non-binding proposal. This second phase of the process, divided into four stages, stipulates that the proposal must include, among other things, the price offered for the acquisition of the shares and information on how to obtain the financial means required to carry out the purchase.
National or foreign operators, individually or in consortia, can submit bids, provided they fulfil the defined criteria, including revenues of more than €5 billion in at least one of the last three years and proven experience in the aviation sector.
The proposals will also be evaluated on fleet reinforcement, investment in maintenance and engineering, commitment to sustainable fuels, respect for labour commitments and vision regarding a possible reinforcement of the shareholder position, according to the recently published specifications.
As the government announced in July, the privatisation of TAP, which also includes Portugália, the TAP Healthcare Unit, Cateringpor and SPdH (formerly Groundforce), is expected to take place over the course of around a year. The final timetable will be dependent on regulatory authorisations.
In addition to Air France-KLM, German group Lufthansa and the International Airlines Group (IAG), which owns British Airways and Iberia, have already publicly expressed an interest in this purchase.
But on the same day that Air France-KLM formalised its interest in coming to a deal, a team from the Public Prosecutor’s Office, backed by a posse of PJ police inspectors and magistrates, conducted searches at TAP’s headquarters over suspicions of crimes in the first privatisation involving the Atlantic Gateway consortium, ten years ago…
At issue are suspicions of qualified fraud, economic participation in business, receipt of undue advantage.
This was always a privatisation that raised eyebrows, on the basis that it was rushed into being as the PSD government of the time toppled.
Also searched were the premises of Parpública, Grupo Barraqueiro – the transport empire of Humberto Pedroso, part of the Atlantic Gateway consortium, and various lawyers’ offices.
Four ‘arguidos’ (official suspects), resulted from the searches: (one being TAP CEO Fernando Pinto, according to Correio da Manhã, the other two being Humberto Pedroso and son David).
The fourth arguido is described as a business. If this is Barraqueiro, it has already conveyed “confidence and tranquility” through a statement to the press, adding that it handed public prosecutors “all relevant information on the TAP privatisation process, including extensive proof of not having realised any act less clear or suspect of irregularity”.
It goes without saying that the timing of these searches cannot have been welcomed in government quarters.
From the point of view of potential buyers, the airline has also posted its half year profits (€55 million), which don’t touch the sides even of the latest legal drama, in which the company must compensate dozens of employees sacked during the pandemic, to the tune of around €300 million.
Reactions to the swoop yesterday came from multiple quarters – the government doing its best to show tranquility; President Marcelo saying that in view of the privatisation process, it is important that the investigation is carried out ‘rapidly’ (a curious choice of word considering it has taken 10 years to reach this point) and PCP leader Paulo Raimundo being characteristically direct:
“There is no doubt that there was political and economic crime in the 2015 privatisation, ” he said on the sidelines of a meeting in Vila Nova de Gaia, calling the process “a scam” which appears about to reveal even more than political and economic malfeasance.
“Let the searches be carried out, let the facts be identified, because we had already established that TAP was bought with TAP’s money, TAP’s aeroplanes were bought with TAP’s assets, (there was) no investment from those who supposedly bought TAP. And so, let the investigation be carried out,” he said.
Sources: LUSA/ Correio da Manhã/ RTP/ Diário de Notícias
