Lufthansa considering a bid for TAP

[PAXboy]

TAP is due to be privatised this year. Two reputable sources linked on LH interest.

Lufthansa to Consider Bid for Star Partner TAP in Portugal - Bloomberg (http://www.bloomberg.com/news/2012-05-16/lufthansa-says-will-consider-purchasing-tap-in-portugal.html)

Lufthansa bid to Tap into LatAm market - FT.com (http://www.ft.com/cms/s/0/4040f448-9dc6-11e1-9a9e-00144feabdc0.html#axzz1v8j5irE4)

[Fairdealfrank]

Lufthansa considering a bid for TAP

Suspect it's more than "considering".....

The Star Alliance needs to keep a presence in south America, particularly in Brazil. TP would be perfect for this.

IAG has expressed an interest in buying TP (for the same reason), and JJ may shift from Star to Oneworld (as part of the merger with LA (Latam)).

So, no surprise there.

BD out, TP in?

[PAXboy]

From what I read - Yes. TAP has a lot more long haul to play with and LH certainly would want to try and prevent IAG taking over TAP as well as Iberia.

[max nightstop]

Good luck to all our Portugese colleagues. Hold on to your hats, (and your jobs, pensions, pay scales, working conditions etc) your lives are about to be the next pawns in the European aviation chess game.

[PAXboy]

Whoever buys them - they will get stripped down and cut back and slimmed over etc. That's the only path for all the legacy companies. They will either be bought and slimmed or get slimmed in one big bang (SABENA etc.)

By the time the slimming and consolidation is complete - the Euro aviation biz will look very different.

[Heathrow Harry]

TAP shorthaul will be mauled - they are not that good and the competition is fierce - unless they leave the Euro and they can become a cheap short haul operation

they have very good operations to Brazil, Angola & Mozambique - all likely to be recession proof business destinations for years - thats why LH want them I expect

[Omnipresent]

I wouldn't be so sure about LH buying TAP. The current CEO is far less acquisitive than the previous one. It has been badly scarred by the bmi fiasco and still has to fix Austrian and it's in the midst of a very radical overhaul of its own internal structure.

As for IAG, I think another acquisition in the current year would be unpalatable for investors.

It's also worth noting at this stage it's not known whether the whole of TAP will be sold off, or just a stake in the airline, which will influence potential buyers significantly IMHO.

[the_penguin]

Good God!

Do the Germans never learn?!?!?!?

For nearly 20 years they bought everything they could lay their hands on - and for the last 4 years they have been trying to get rid of it all. Lufthansa have several basket cases in play as we speak!

The only real success story has been Swiss and only then because they 'did not allow' Lufthansa to mess with them too much - they stayed in control.

Currently in the land of Lufthansa pain are: bmi (almost out of their misery), Austrian, German Wings, SN Brussels, Contact Air, Dolomiti and Jade.

If LH do take over TAP, do NOT expect them to sort anything out. Their management is no better than yours - just ask the boys and girls at British Midland.

[look you]

DLH were worse than bmi!

bmi simply ran it badly and gave employees nothing.

DLH ran it to extinction and took the employees pensions and half of the jobs.

[Fairdealfrank]

Quote: "TAP shorthaul will be mauled - they are not that good and the competition is fierce - unless they leave the Euro and they can become a cheap short haul operation

they have very good operations to Brazil, Angola & Mozambique - all likely to be recession proof business destinations for years - thats why LH want them I expect"

Exactly, and so do IAG, for the same reasons!

Quote: "Good God!

Do the Germans never learn?!?!?!?

For nearly 20 years they bought everything they could lay their hands on - and for the last 4 years they have been trying to get rid of it all. Lufthansa have several basket cases in play as we speak!

The only real success story has been Swiss and only then because they 'did not allow' Lufthansa to mess with them too much - they stayed in control.

Currently in the land of Lufthansa pain are: bmi (almost out of their misery), Austrian, German Wings, SN Brussels, Contact Air, Dolomiti and Jade.

If LH do take over TAP, do NOT expect them to sort anything out. Their management is no better than yours - just ask the boys and girls at British Midland."

Quote: "DLH were worse than bmi!

bmi simply ran it badly and gave employees nothing.

DLH ran it to extinction and took the employees pensions and half of the jobs."

.....and half the BD slots!

The word "asset-stripping" comes to mind. Should it?


There's a quote on the "BER delayed opening" thread about being able to everything but nothing properly......

[EuroWings]

Realistically, I reckon the future of European legacy carriers is consolidation into groups. In the face of sharply rising costs and fierce short-haul competition from the LCCs, smaller players are increasingly squeezed and will slide into poor financial shape (if they haven't done so already!). European Governments can't pour money into these operators either.

As we have seen time and time again, well established "national flag carriers" can fail...

[MaxRange120]

British Airways (IAG) parent IAG said its interest in purchasing Portuguese carrier TAP SGPS SA has cooled after the addition of U.K.-based BMI brought sufficient airport slots to improve connectivity with Latin America.

“Our interest in TAP has waned,” Chief Executive Officer Willie Walsh said today in an interview in Brussels. While IAG, or International Consolidated Airlines Group SA, remains interested in acquisitions, there are none that appear suitable right now, he said.

TAP is likely to become available for purchase this year as Portugal seeks to raise funds under the terms of a 78 billion- euro ($98 billion) bailout from the European Union and the International Monetary Fund. Walsh had said previously that the Lisbon-based company was high on his list of takeover targets.

TAP would bring IAG lucrative Brazilian routes should the London-based company’s Oneworld partner, Lan Airlines SA (LAN) of Chile, quit the alliance following a merger with Sao Paulo-based Tam SA (TAMM4), a member of the rival Star grouping.

Walsh said today that BMI’s takeoff and landing slots at crowded London Heathrow airport are in any case sufficient to add capacity to South America, making TAP less of a prospect.


IAG (http://www.businessweek.com/news/2012-05-24/iag-s-interest-in-buying-portugal-s-tap-has-waned-walsh-says)