LISBON, April 14 (Reuters) - Portugal may need to nationalise its flag carrier TAP and other companies badly hit by the economic impact of the coronavirus outbreak, Prime Minister Antonio Costa said on Tuesday.
TAP was partially privatised in 2015 and the state still holds a 50% stake.
“We cannot exclude the need to nationalise TAP or other companies that are absolutely essential for the country. We cannot risk to lose them,” Costa told Portuguese newspaper Observador.
“This is a health crisis that is turning into an economic crisis and we can’t let it get worse,” he said.
Last month, TAP said it would temporarily lay off around 90% of its employees because of the coronavirus crisis that led to a collapse in demand for travel.
Private consortium Atlantic Gateway, led by Brazilian-U.S. airline entrepreneur David Neeleman, has a 45% stake in TAP and TAP employees hold the remaining 5%.
Speaking to TVI television on Monday evening, Portuguese finance minister and Eurogroup chief Mario Centeno also said the nationalisation of TAP could be an option.
“We will certainly not remove any possibility from the table to respond to challenges,” Centeno said. “TAP has unique challenges, but there are many ways to intervene without going there (nationalisation) but this can be one of the ways.”
Portugal has more than 16,900 confirmed cases of the virus and 535 reported deaths.
TAP ended last year with its best ever cash position despite making a net annual loss of 106 million euros.
Reports in the German media in February said Germany’s Lufthansa and U.S. carrier United Airlines were considering a joint takeover of TAP.
Costa said “there was interest from a company” but at the moment it was “suspended” because airlines are “thinking about how they will rise from this pandemic and not about new investments”. (Reporting by Catarina Demony, Additional reporting by Sergio Goncalves, Editing by Susan Fenton)
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