LISBON: Portugal's government has received three bids for the struggling state-owned flag carrier TAP in its second attempt to privatise the heavily indebted airline since 2012.
Transport Secretary Sergio Monteiro would not disclose the names of investors or institutions who made the offers, but sources close to the process told Reuters two Brazil-based aviation tycoons and one Portuguese investor had presented the offers by Friday's deadline.
One of the interested parties was Brazilian-American businessman David Neeleman, the founder of US airline JetBlue and CEO of Azul Brazilian Airlines, a source said. "Brazilian-Colombian investor German Efromovich had also made an offer.''
Efromovich controls Latin America's Avianca via his holding Synergy and had made a bid for TAP in 2012. That was rejected at the time because of a problem with financial guarantees.
TAP operates a fleet of 77 planes with 2,500 weekly flights, many of them to Brazil, with which Portugal has historic ties.
Because of European Union state-aid rules, the government cannot inject capital into TAP, which has debts of over €1 billion ($1.1 billion). It does not expect much revenue from the sale, but hopes that investors will rid the state of the debt.
The source would not give details on whether Efromovich was bidding alone or with partners. A newsletter published by Airline Economics magazine reported earlier that Efromovich was bidding, as well as US fund Greybull Capital LLP.
A third source close to Portuguese investor and aristocrat Miguel Pais do Amaral, who has interests from media to mining, said he had made a bid via his private holding company, Quifel.
Portuguese media have also reported that American investment funds Apollo Global Management LLC and Cerberus Capital Management LP could be part of an offer.
"This is the day of hope for TAP and its workers, hope that we will see it grow, with capital and conditions to compete with European peers," Monteiro said, hailing a competitive environment in the privatisation process for a 61% stake in TAP despite "much internal noise".
The government, which faces an autumn election, wants the sale to be sealed by the end-June.
The leader of the main opposition Socialists, Antonio Costa, has been critical of the sell off and said earlier his party would take legal measures to prevent the state from losing control of TAP.
Monteiro said such threats were not beneficial to the country's image as it seeks to attract foreign investors.
State property holding Parpublica will now evaluate the financial side of the offers, and TAP will pore over the technical side for five days.
The cabinet will later decide on whether to proceed to a second phase of negotiating directly with bidders.
TAP was hit by a 10-day pilots strike earlier this month, which is estimated to have cost it some €35 million ($40 million). Pilots have demanded a stake in the airline, which the government has refused.
After an earlier strike threat at Christmas, the government guaranteed future buyers would be barred from laying off workers en masse as long as the state remained a shareholder. The state is retaining a 34% stake that can be sold in two years. reuters