Portugal eyes German interest in privatizations
LISBON, Portugal — Portugal’s prime minister, seeking to encourage German investment in his debt-troubled country, says the planned privatization of TAP Air Portugal would be a strong investment for Lufthansa.
The Portuguese flag carrier would allow Lufthansa to expand in Africa and Latin America where TAP has a strong presence, Prime Minister Pedro Passos Coelho was quoted as saying in an interview published Friday in German newspaper Handelsblatt.
Passos Coelho told the paper that TAP, currently fully-owned by the state, “would be a good investment for the German company.”
His office confirmed the comments.
Portugal, which earlier this year needed a (euro) 78 billion ($112 billion) bailout, aims to raise around (euro) 5 billion ($7 billion) through privatizations over the next three years.
Lufthansa and TAP are both part of the Star Alliance, a global grouping of national airlines.
TAP posted a profit of more than (euro) 63 million last year. Its total debt stands at almost (euro) 1.3 billion, according to its 2010 annual report.
During his visit to Berlin on Thursday, where he held talks with Chancellor Angela Merkel, Passos Coelho said German investors “are very welcome in Portugal.”
Portugal slid into a double-dip recession this year, and the economy is forecast to keep shrinking through 2012. The jobless rate is 12.3 percent and is predicted to reach 13.2 percent next year. Germany, on the other hand, is one of Europe’s strongest economies.
Passos Coelho said late Thursday during a trip to Paris that German electricity and gas supplier E.ON has expressed interest in buying a 20 percent stake the government plans to sell in Portuguese utility Energias de Portugal.
The government wants to sell the 20 percent stake to a single buyer, he said.
Brazilian energy company Eletrobras has also said it is examining the possibility of bidding for the EdP stake.
EdP shares soared by 8.4 percent on the Lisbon stock exchange Friday on news of the interest.
Foreign Minister Paulo Portas recently traveled to Angola, Mozambique and Brazil — Portuguese-speaking countries that are among the world’s fastest-growing nations — to raise interest for the privatizations.
Stakes in oil company Galp and electricity grid REN are also to be sold this year.
Other selloffs include airport management company ANA, mail company Correios de Portugal, part of rail company Comboios de Portugal, one of state broadcaster Radiotelevisao Portuguesa’s television channels, and national news agency Lusa.