British Airways (BA) has confirmed that it is part of a consortium looking at bidding for Spanish airline Iberia.
Iberia is Europe's fourth largest airline
The UK airline said it had joined forces with private equity groups TPG Capital, Vista Capital, Inversiones Ibersuizas and Quercus Equity.
But BA added in its statement that there was "no guarantee that a formal bid will be made" for Iberia.
Prior to BA joining its consortium, TPG has already informally offered 3.4bn euros ($4.6bn; £2.3bn) for Iberia.
BA already owns a 10% stake in Iberia and has an option for another 30%.
Iberia is Europe's fourth largest airline, with lucrative routes to South America.
While TPG Capital is based in the US, Vista Capital, Inversiones Ibersuizas and Quercus Equity are all Spanish companies.
"If a bid was successful, Iberia would remain in Spanish control, and the Spanish investors would put in more than 50% of the total capital investment," said a BA spokeswoman.
Without continuing majority Spanish control, Iberia would have to renegotiate its access to the South American destinations.
The BA spokeswoman added that "we're exploring our options and haven't ruled out anything, including disposing of the [Iberia] stake".
German flag carrier Lufthansa repeated on Tuesday that it remained interested in Iberia, but said the likely asking price for the Spanish carrier was now too expensive to justify a takeover.
The BA consortium may also face a rival bid from fellow private equity business Apax.
Revenues at Iberia, which employs 25,000 people, were up 10% last year - but profits fell 64%.
Consolidation in the airline industry is expected to continue as the "open skies" agreement between the US and Europe will allow more budget airlines to fly across the Atlantic.