Portugal to kick off TAP airline privatisation next week, PM says

FILE PHOTO: TAP planes are seen at Lisbon's airport during partial lockdown as part of state of emergency to combat the coronavirus disease (COVID-19) outbreak in Lisbon

LISBON (Reuters) - Portugal's government will approve the legal framework for the privatisation of state-owned airline TAP next week, kicking off the sale after a few months' delay, Prime Minister Antonio Costa said on Tuesday.

The government has said it intends to keep a strategic stake in the carrier, which is undergoing a restructuring under an EU-approved 3.2 billion euro ($3.53 billion) rescue plan.

At least three major global players - British Airways and Iberia owner IAG, Lufthansa and Air France-KLM - have so far shown an interest in TAP.

"I can confirm that next week the cabinet will approve the document that will establish the (legal) framework for the privatisation of TAP, defending the company, and the interests of Portugal and the Portuguese," Costa told lawmakers during a debate.

The cabinet meets every Thursday and next week's meeting will take place on Sept. 28.

Costa said the European Commission's view was that TAP is "implementing the restructuring plan successfully", pointing out that the 7.58 million passengers it carried in the first half of 2023 - a 30% increase from a year ago - already represented 96% of the traffic in the same period of the pre-pandemic 2019.

TAP swung to a net profit of 23 million euros in the first half from a loss of 202 million earlier on strong revenue growth.

The privatisation process, which was initially scheduled to be launched in July, will take months and should only be concluded next year.

(Reporting by Sergio Goncalves; editing by Andrei Khalip, Alexandra Hudson)