Below is the yahoo article:
All i can say is: Watch out StarAlliance! The empire strikes back!
Swissair looking to buy Brazil airline--paper
SAO PAULO, May 11 (Reuters) - SwissAir parent SAirGroup wants to buy at least one of Brazil's top airlines and is planning joint flights between Brazil and Switzerland as the first step, a local newspaper reported Thursday.
Daily Folha de S.Paulo quoted Markus Altenbach, SAirGroup's chief representative in Brazil, as saying closer links could result from the joint flights.
``Who knows, maybe later we can turn (into) shareholders,'' he told the newspaper.
Quoting sources, Folha said the Swiss company was negotiating with Brazil's biggest air company, Varig , as well as Transbrasil , the country's No.4 airline.
The newspaper said Swissair could initially sign a deal with one of the top airlines that operate international flights to jointly manage daily 240-seat flights between Brazil and Switzerland.
But ultimately, the Swiss group was looking for acquisitions.
Folha reported that, following the operational agreement signed earlier this month between third-ranking TAM and Transbrasil, the SAirGroup may target the so-called TAMbrasil alliance.
Although denied by TAM and Transbrasil, analysts viewed the deal as a first step toward a merger. Many analysts expect consolidation in the sector, which is still suffering from the January 1999 currency devaluation that raised dollar-linked fuel and leasing costs, while slashing passenger numbers.
According to Folha, the Swiss company had ruled out any deal with No.2 airline Vasp, which is restructuring to ease its debt burden and is cancelling all international flights from mid-May.
Varig has a fleet of 82 aircraft operating on local and international routes. Tam has 60 aircraft and Transbrasil has 22.
Transbrasil officials said they hoped teaming up with Tam would give the two airlines 46 percent of domestic market against Varig's 45 percent.
SAirGroup earlier this month bought British Airways' unprofitable French domestic unit Air Liberte.