BA looking to purchase TAP?
Published on
It has been reported that British Airways is looking at the possibility of purchasing TAP Air Portugal. One of the strongest signs yet that the Portuguese airline may be brought under the umbrella of International Airlines Group, the holding company whose brands include Iberia and British Airways is a statement from Willie Walsh, the chief executive of the company, to the Daily Telegraph that the acquisition of TAP would a "once in a lifetime opportunity".
Even in the midst of an economic slowdown, IAG seems prepared to be ready to make a sizeable investment in Portugal's TAP. Mr. Walsh has said to the Daily Telegraph that despite the current economic turmoil, TAP is an acquisition which is well worth taking a look at.
It was reported in The Portugal News last week that TAP's strength in the Brazilian market was helping the airline to attract the interest of UK and Spanish airlines. This was cited as a factor by IAG's chief executive, who noted that TAP is the top carrier between Brazil and Europe, with routes to eight different Brazilian cities and has led to IAG seeing TAP as a prime candidate for acquisition.
A study conducted by IAG of a dozen airlines on the possible effects of consolidation looked at the ramifications of mergers both from a financial standpoint as well as how these mergers may be affected by regulation from the European Commission and other regulatory bodies.
At least for the moment, TAP has refrained from commenting on any possible merger or acquisition. When industry experts began to speculate about the possibility of TAP's being acquired, a spokesperson said "only after the privatisation process is opened and the respective terms established will the company address any show of interest." The privatization of TAP is part of the conditions attached to the recent bailout package extended to Portugal by the IMF and the European Union.
British Airways isn't the only potential suitor for TAP; Lufthansa, TAM/LAN and Latam have all shown interest in the possibility of acquiring TAP. The airline may be a hotter property than ever, with an announcement that July 2011 was a record setting month for passenger traffic, with more than a million passengers carried, beating the previous record of slightly under a million in August of last year.
In the first half of the year, TAP has seen an 11.6% increase in passenger of traffic overall as well as an increase in occupation rates on its flights, up to 76.1% from 72.6% the previous year. In a statement from the airline, a spokesperson attributed the increase to an overall growth in the airline as well as the addition of new routes and other improvements made by TAP over the last year. Recently added destinations include Athens, Vienna, Dubrovnik, Manchester, Dusseldorf and Bordeaux in Europe, Sao Vincente, Bamako and Accra in Africa, Porto Alegre in Brazil and Miami, Florida in the US.
Earlier this month, the Portuguese Minister of the Economy, Alvaro Santos Pereira stated that even once TAP has been sold, the government will do everything within its power to make sure that TAP's hub remains in Lisbon.
For info on property for sale in Portugal contact the Portugal property team via email at: info@portugalproperty.com or call free on +(0) 800 014 8201
Published in: