Privatisation in transportation industry to go ahead

Following enforcement from the Government, Portugal will soon see the privatisation of aviation companies Aeroportos de Portugal (ANA) and TAP Airlines, plus rail-based transportation company, CP Carga.

Last year, the Portuguese Government committed to privatisation of TAP and ANA under the terms of the €78 billion bailout programme it agreed with the European Union and the International Monetary Fund.

Financial advisors, Barclays Capital, Banco Espirito Santo, Citi Bank and Crédit Suisse have been appointed to provide assistance throughout the privatisation processes of ANA and TAP.

For legal matters, Vieira de Almeida & Associados have been selected to advise TAP and PLMJ to guide and advise ANA.

Since the presidency of ANA’s Guilhermino Rodrigues ended in 2010, the election of a new governing body for the company has been suspended.

However, a meeting to discuss the company’s future has been set to take place on June 15.

Privatisations of both ANA and TAP are expected to take place this year and CP Carga in 2013.

The government is predicted to come up against pressures to ensure that TAP is privatized before ANA, as the airliner holds major hub operations at ANA’s Lisbon Airport, providing the future owner of ANA with major assets riding on TAP.  

Companies such as Lufthansa and the International Airlines Group have both expressed interest in TAP, due to the airlines reputable involvement in the European market, and in addition their flights established in the fast-growing Brazilian market.

Although the most recently available rates for TAP report a net loss of €57.1 million in 2010 and this is an important issue in the decision making process of both interested parties.

Potential bidders for ANA include investment fund owners of Gatwick and London City airports – Global Infrastructure Partners, the group that controls BAA (operators of London’s Heathrow Airport) – Forrovial, Frankfurt Airport operator – Fraport and also Aéroports de Paris, which operates the Charles de Gaulle Airport in Paris.

It is reported that ANA registered a net profit of €76 million in 2011, which represents and 37% increase from 2010’s rates, providing a valuable selling point for those attracted to the deal.