The deadline for interested parties to hand in their offers to purchase the national Portuguese flag carrier expires at 5pm this Friday (15 May).
A consortium led by Brazilian David Neeleman, which has reportedly attracted considerable share capital from Portuguese investors is among the front-runners in securing a majority share of TAP.
Another strong contender is Germán Efromovich, also a Brazilian citizen, who saw his bid for the national airline rejected in 2012 due to his reported failure to present guarantees to underline the company’s re-capitalisation.
Back then, the owner of Avianca Taca of Columbia and Avianca Brazil, had been the sole bidder, but this time round TAP’s privatisation has sparked greater interest, despite the company suffering losses in 2014 coupled with the recent crippling industrial action endured by the airline.
Greybull was contacted this week by The Portugal News, but the company opted not to comment on reports it had prepared an offer for TAP.
Moving away from the Portuguese airline, Greybull describes itself as a company which backs “management teams with opportunities in early stage, growth, and mature companies.
Through investment and innovation Greybull aims to help create growing and profitable enterprises.”
Greybull last autumn stepped up to buy Monarch for around £125 million and saving around 2,500 jobs in the process. After acquiring a 90 percent stake in the company, the airline announced plans to focus on five UK airports only, while cutting its fleet from 42 to 34.
The deal was finalised after an agreement by staff to take pay cuts.
According to the company, staff agreed pay reductions of up to 30 percent, while 700 people were made redundant, two-thirds of whom were voluntary.
While this business model might not go down as well with some sections of the TAP workforce, which have recently gained a reputation for taking regular strike action, the Monarch Group revealed earlier this year that it expects to return to profit by the end of 2015, having hit all its targets on revenue and costs in the first 100 days trading since the major restructuring last year.
In line with what took place at Monarch last year, the Government has reportedly this week asked the TAP board to study the possibility of retrenchments and a reduction in flights.
But Prime Minister Passos Coelho denied this claim on Thursday.
Nonetheless, a day earlier, TAP chairman Fernando Pinto wrote to TAP staff telling them that “sometimes to go forward, you need take a few steps backward”.
He added that labour unrest has been a damaging distraction and has resulted in direct and substantial losses to the company.
But with TAP pilots and their union ruling out any further strike action, the company will, for now at least, be allowed to focus on making themselves a more attractive proposition for private investors.
The full identities of those who handed in offers and the contents of bids for TAP is only expected to become known over the weekend, once details of the final bids emerge.
It is unlikely that money will prove to be decisive, as the Government has already said it does not want to make a profit from the sale of the airline.
Instead, the capitalisation of the airline and the percentage of the share sought by private investors could play a bigger role in swaying the Government’s final decision.
Additional negotiations can be expected following the expiry of the deadline, with the Government able to call on bidders to improve their offers.
A final decision, which should see around two-thirds of TAP fall into the hands of private investors, should only be known during the month of June.
Back in 2012, it took the Government two weeks to reach a decision, which might have been aided by the fact that there had been only one bidder.
Whenever a final verdict is reached, the actual deal is unlikely to be pushed through before the October general elections.
This could spell trouble for investors as the opposition Socialist Party, well ahead in the polls, has successively spoken out against the manner in which TAP is being sold off, and could yet scupper any deal for the airline to land in the hands of private investors.