VdA, PLMJ and CS Associados advise on TAP agreement

While the whole country was expecting the outcome on the TAP airlines capitalisation among the Government, Humberto Pedrosa from Barraqueiro Group and David Neeleman from Azul airways, the legal counselling was covered by some of the most prestigious firms and lawyers of the country.

Client: Parpública – Participações Públicas (SGPS), S.A.; Portuguese State.

Announcement Date: 17/07/2020

Closing Date: 02/10/2020

Confidential: NO

Type of Transaction:

Acquisition / Sale
State Aid Rescue Loan

Synopsis of the Deal:

VdA advised the Portuguese State and Parpública – Participações Públicas (SGPS), S.A. ("Parpública"), in the context of a State aid rescue loan of up to EUR 1.2M to the Portuguese flagship airline, Transportes Aéreos Portugueses, S.A. (“TAP"), and on the acquisition by the Portuguese State of an additional 22.5% of the share capital of TAP – Transportes Aéreos Portugueses, SGPS, S.A. ("TAP SGPS") – the holding company of TAP Group, acquisition which together with the 50% stake already held by Parpública, wil make the Portuguese State to heold directly and indirectly a 72,5% stake in TAP SGPS.

Moreover, VdA also advised the Portuguese State on TAP SGPS’ application for State aid of up to EUR 1.2M, which was authorised by the European Commission on 10 June 2020.

The State aid measure took the form of a rescue loan up to a maximum of EUR 1.2M granted to TAP.

In light of the above, a convertible loan agreement up to a maximum of EUR 1.2M was executed on 17 July 2020 between the Portuguese State, as Lender, TAP, as Borrower, TAP SGPS, as Guarantor and Portugália – Companhia Portuguesa de Transportes Aéreos, S.A., as a subsidiary of the TAP Group and sister company of TAP.

Target: TAP – Transportes Aéreos Portugueses, SGPS, S.A., the holding company of TAP Group, which owns, among other subsidiaries, Transportes Aéreos Portugueses, S.A.

Target Industry:

Aviation
Transportation

Country of Target: Portugal

Sellers (%) – Atlantic Gateway SGPS, Lda. – Portugal

Purchaser/Investor (%) – Country: Portuguese Sate (22.5%) – Portugal

Deal Value (in local currency) (acquisition plus loan): EUR 1,255,000,000

Financial Advice: Deloitte

Legal Advice:

VdA – advised the Portuguese Sate and Parpública – Participações Públicas (SGPS), S.A.
PLMJ Advogados, SP, RL – advised TAP and AGW’s shareholder DGN Corporation
Campos Ferreira, Sá Carneiro e Associados - Sociedade de Advogados – advised AGW’s shareholder HPGB, SGPS, S.A.)

VdA Team Involved: