Government dances around TAP cash needs

Portugal’s Finance Minister said on Thursday that he does not know exactly how much cash TAP will require to keep in the air.

In an interview with RTP when asked if TAP would need a €500 million rescue package, Mário Centeno said that he didn’t know and any cash line would depend on how the eventual package was put together.
The minister said that there wasn’t even much clarity on how cash injections would be phased. “We don’t know, it somewhat depends on the scenario that will be outlined [by the company).
The Government is today meeting with TAP’s Executive Commission led by Antonoaldo Neves and Mário Centeno stressed “the irreplaceable strategic role” that the airline has for Portugal and its economy.
“The responsibility with which the Government will deal with these issues will remain and tax payers money is something that will obviously be take into account” he said.
Portugal’s Government has not excluded the possibility of nationalising the airline in which it already has a controlling share.
Mário Centeno reiterated that there was still a lot of uncertainty over what decisions would be taken and what would happen in the airline industry as a whole.
The minister said that the amount given to TAP would depend on by what measure of control the Government would have in the overall decision and strategy making at the airline which is 49% privately owned.
“The State will not put in a single penny, nor even underwrite a loan, if this does not mean more control and a suitable say in decision making commensurate with the level of financial support required” added the Prime Minister António Costa.
In other words, if the State has to use tax payers cash to bail out the grounded airline, the State will have an increased say in how it is being run.
The State has a 50% share in TAP through its public company Parpública while the consortium Gateway (owned by Humberto Pedrosa and David Neeleman) own a 45% share. The remaining 5% is owned by the companies staff.
TAP plans to restart flights to Brazil from 18 May and has already started flights to London and Paris in line with demand.