White smoke: TAP wrestled back from threat of nationalisation

Negotiations appear finally to have wrestled bankrupt national airline TAP back from the threat of nationalisation.

Expresso has just reported that the ‘conditions imposed by the government for a deal’ (which will bring with it a much-needed cash injection for the airline of €1.2 billion) ‘have been accepted’.

This takes the ‘worst case scenario of nationalisation’ off the table.

The deal is expected to be announced in more detail later today, following the weekly Council of Ministers.

Say reports that have not been fully confirmed, the essence of the agreement is that shareholder David Neeleman – who holds 50% of the Atlantic Gateway consortium that owns 45% of TAP – has given up his fight to hang on to the terms of a lucrative loan agreement signed with his own airline, Azul Airways.

As a result, he stands to ‘get his money back over time’ – but on nothing like the same terms, and not as a shareholder.

This has been a Herculean struggle (basically to see who blinked first) – and the government appears to have ‘won’.

It will now take over 72.5% control of TAP, with Atlantic’s other shareholder, transport Humberto Pedrosa, staying in place.

At least, that’s the basis of the Expresso story this morning which admits it hasn’t had any of this totally confirmed by an official government source.

For more on this major headache in the midst of a pandemic (click here).

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