Last year private investors acquired 61% of the carrier last year but António Costa, the socialist prime minister, had campaigned to reverse the sell-offs made by the previous government.

Atlantic Gateway, the consortium with a majority stake in Tap, will be paid €1.9 million to increase the government’s stake to 50%, the Financial Times reported.

Atlantic Gateway had paid €10 million for Tap last November and agreed to invest a further €338 million.

“I’m not saying I’m happy [with the revised terms],” David Neeleman, one of the consortium investors told the FT. “But TAP needs to be saved because it’s burning too much money. Decisions cannot be political. They need to be what is best for the company."

Atlantic Gateway is a joint venture between Neeleman, who founded airline JetBlue and Portuguese bus company owner Humberto Pedrosa.

A 5% share sale to employees could see Atlantic Gateway’s stake reduced to 45%.