Russia's number two airline, S7, said Tuesday it may buy a major stake in ailing Austrian flag carrier Austrian Airlines (AUA), putting it in competition with Germany's Lufthansa.
  
"We are currently considering the possibility of participating in the tender for a stake in Austrian Airlines," S7 spokeswoman Irina Kolesnikova told AFP after the Austrian government announced it would sell a 42.75 percent stake.
  
"This is attractive in terms of our overseas development," she said.
  
A total of six airlines, including Lufthansa, Air France-KLM and S7, are in the running to buy the AUA stake, Austrian daily Oesterreich reported Monday. Lufthansa has also confirmed it is considering a bid.
  
S7 is seen as having an advantage over Lufthansa as the Russians would pledge to retain Vienna as AUA's main hub, the daily reported.
  
The takeover of a foreign carrier is "one of the tools available" for S7 to expand its operations abroad, S7 spokeswoman Kolesnikova said, noting it would bypass limits on establishing new international routes.
  
Potential buyers had until Sunday to express interest in the AUA stake, currently held by the state-owned holding company OeIAG.
  
OeIAG has until the end of the year to find a partner for AUA, which has nearly 900 million euros (1.4 billion dollars) of debt and lost 48.7 million euros (72 million dollars) in the first six months of 2008.
  
The Austrian government agreed AUA could be fully privatised on condition that a blocking minority stake of 25 percent plus one share remain in Austrian hands. Most of the airline's shares are currently held by private investors.