The last full day of speculation as to who, if anyone, will put in a bid for 66% of the shares in state airline TAP has seen Barraqueiro join David Neeleman’s Azul in a new partnership.
The Friday deadline has media pondering the names brave enough to go the course and Barraqueiro Transportes SA, owner of Frota Azul coaches and other transport businesses in Portugal, is a late entrant with maybe too little time to have gone through the figures in sufficient detail.
The new consortium is said already to have secured capital of €300 to €350 million, the minimum needed by bidders to ensure TAP’s partial recapitalisation, with the balance funded with the support of investment funds.
Humberto Pedroso, president of Barraqueiro, did not confirm his connection with David Neeleman, but acknowledged that TAP "is a subject that interests us," and that he is thinking about it, adding that it is important that the business goes to a Portuguese company.
Other newspapers report that David Neeleman and Germán Efromovich are the only two whose bids will be of sufficient weight to pass the various government benchmarks and that the decision will be made soon after the end of tomorrow when bids have to be in, even though the government has until the end of the month to decide.
Needleman's bid includes a promise to distribute 10% of company profits to staff.
Paulo Kakinoff, the owner of Gol, and the Frank Lorenzo consortium are thought not to be committed to placing a final bid despite spending much time and energy of analysing an airline while its performance steadily declined.
The socialist party intention, should it win this year’s general election, is to re-nationalise TAP, one more worry for any buyer already preparing to take on unions, inefficient working practices, high salary levels and the general mistrust of management by employees.
Meanwhile, at the last minute, the Supreme Administrative Court is analysing an injunction calling for the suspension of the privatisation of TAP.
The action lodged by ‘Associação Peço a Palavra’ claims that the sales process contains illegal clauses which are impossible for any buyer fully to meet.
To prevent delays, the Council of Ministers decided today to invoke the "public interest" clause as a way to keep the sale going ahead.
The law gives the government a 15 days period within which to respond to any acceptance of the injunction by the court, but the government had to act quickly at the risk of not being able to continue to the next phase of the sales process.
Government documents sublitted to head off this injunction claimed that if the airline was not sold, it would be condemned to insolvency or 'restructuring.'
The deadline for bids is 5pm this afternoon.
