Lufthansa will pay 1.025bn euros for 44.9% of TAP Air Portugal after beating Air France-KLM. What it means for Star Alliance, Brazil routes and fares.
Cover image: A TAP Air Portugal Airbus on the apron (file photo) — photo by Aeroprints.com, CC BY-SA 3.0, via Wikimedia Commons.
Lufthansa Group has won the race for TAP Air Portugal. After an extraordinary cabinet meeting on 14 October 2026, the Portuguese government selected Lufthansa's offer of 1.025 billion euros for a 44.9 per cent stake, beating Air France-KLM: the prime minister said Lufthansa's offer was 16 per cent higher than its rival's. The state keeps 50.1 per cent for now, with 5 per cent reserved for employees, while Lufthansa takes executive and operational management of the airline.
The deal reshapes European aviation. TAP stays in Star Alliance and keeps its brand, Lisbon hub and headquarters, but Lufthansa gains the strongest European network into Brazil and Lusophone Africa and a much stronger position in the South Atlantic market. According to Air Data News, Lufthansa also plans to bring TAP into its A++ transatlantic joint venture with United and Air Canada, subject to regulatory approval, which would end its role as the low fare outsider across the Atlantic. Expect knock on changes to codeshares, fares and corporate contracts on Europe to South America routes.
What did Lufthansa offer for TAP?
Lufthansa offered 1.025 billion euros in cash for 44.9 per cent, rising to as much as 1.2 billion euros for up to 49.9 per cent once the employee allotment and a ticking fee are counted. The government puts the total value of this first phase at 1.201 billion euros including the 5 per cent reserved for staff, valuing the whole airline at 2.552 billion euros. Prime Minister Luís Montenegro said the German offer was 16 per cent higher than the Air France-KLM proposal and carried less uncertainty, since Lufthansa bid all cash while its rival offered cash plus shares.
| Bid element | Lufthansa Group | Air France-KLM |
|---|---|---|
| Price for the stake | 1.025bn euros for 44.9% | Lower: Lufthansa's offer was up to 16% higher, per the government |
| Payment form | All cash | Cash plus group shares |
| Employee shares | Up to 5% offered to staff first | Not disclosed |
| Management | Lufthansa runs the airline | Not disclosed |
| Outcome | Selected 14 October 2026 | Rejected on price and certainty |
Infrastructure Minister Miguel Pinto Luz stressed the choice went beyond money: "This is a strategic decision, which, as was our wish, was not confined to price." Lufthansa chief executive Carsten Spohr called TAP "a strong and profitable airline, our long-standing partner in Star Alliance", adding that the deal lets the group pursue its internationalisation strategy and strengthen its South Atlantic position. For readers new to the alliance landscape, our explainer on Star Alliance, oneworld and SkyTeam sets out why alliance membership shapes every codeshare on these routes.
What happens to the TAP brand, fleet and Lisbon hub?
The safeguards matter to the trade. TAP keeps its brand and headquarters, Lisbon stays the main hub with growth promised at Porto, connections to the islands are protected, and maintenance gets a boost from a new Lufthansa Technik site at Santa Maria da Feira near Porto. Lufthansa already operates 353 weekly flights to six Portuguese destinations, with 75 per cent more capacity than in 2019 and over 500 staff in the country, rising past 1,000 direct jobs by 2030 once the Technik plant is staffed.
The industrial plan is ambitious: about 117 aircraft by 2035 and around 130 beyond, backed by 3 to 4 billion euros of investment. Up to eight Airbus A350-900s could transfer to TAP after 2030, which would become its largest type; Air Data News says the A350's longer range could let TAP consider new long-haul markets such as Asia. TAP has been in Star Alliance since 2005 and serves more Brazilian destinations than any other European carrier, which is exactly the network Lufthansa is buying. Sellers of Europe to Brazil itineraries should watch how codeshare arrangements evolve as integration proceeds.
What still has to happen before the deal closes?
This is a selection, not a completion. Lufthansa expects to sign the agreements shortly, and closing needs regulatory approval including EU competition review. Completion is expected around early 2028, subject to those approvals. The process itself has been long: privatisation was first announced in July 2025, final bids went to the state holding company Parpública on 30 September 2026, and IAG considered bidding but never filed a final offer. The government will shortly begin preparing the second phase, the sale of its majority, which Lufthansa openly welcomes.
For agencies, the practical effects arrive in stages. Nothing changes for bookings today. If the deal and the joint venture move are approved, expect TAP's transatlantic pricing to converge with its partners', corporate deals on Lisbon and Brazil routes to be renegotiated, and connecting itineraries via Lisbon to be folded into Lufthansa group inventory. The group's recent portfolio, from SWISS and Austrian to Brussels Airlines and its new ITA Airways stake, shows how these integrations typically play out. Our 2026 airline results tracker and our guide to the cheapest ways to fly to Europe will both need updating as TAP's fares move inside the joint venture.
Frequently asked questions
How much of TAP is Lufthansa buying?
Lufthansa is buying 44.9 per cent for 1.025 billion euros, potentially rising to 49.9 per cent for up to 1.2 billion euros if employees do not take their reserved 5 per cent. Portugal keeps 50.1 per cent for now ahead of a second phase majority sale.
Will TAP leave Star Alliance?
No. TAP stays in Star Alliance, keeps its brand, headquarters and Lisbon hub, and, according to Air Data News, Lufthansa plans to bring it into the A++ transatlantic joint venture with United and Air Canada, subject to regulatory approval.
When will the Lufthansa TAP deal complete?
Completion is expected around early 2028, subject to signing the agreements and clearing regulatory approval including EU competition review. Do not treat it as done until those steps land.
What does the deal mean for fares to Brazil?
No fare changes have been announced. The A++ joint venture links Lufthansa Group with United and Air Canada, so joining it would mainly affect TAP's role as a low fare outsider between Europe and North America. On Europe to Brazil routes, the change is that TAP's network would sit inside Lufthansa Group. Nothing changes for existing bookings, but agents should watch corporate contract rounds once the deal closes.
