Page last updated at 15:27 GMT, Friday, 12 September 2008 16:27 UK

SAS debates its future structure

Lufthansa logo
Reports suggest Lufthansa is considering a possible takeover

Scandinavian airline SAS has confirmed it is in talks regarding the "future structure" of the group.

Trading in the firms shares had been suspended for most of the afternoon following reports that rival Lufthansa was considering a bid for the group.

SAS said it was considering a number of options but did not name who it was in discussions with.

Like many airlines, the Stockholm-based carrier is struggling to cope with high fuel costs and lower demand.

Before trading was halted, shares in SAS - which is part-owned by the Swedish, Danish and Norwegian governments - were 11% higher.

When trading restarted on the Stockholm stock exchange, the shares immediately jumped 18%.

Joining forces

Higher fuel prices and falling demand have encouraged a number of airlines to consider joining with rivals in an attempt to cut costs.

British Airways, for example, is expected to join forces with both Spanish airline Iberia and American Airlines.

And as a further sign of the problems facing the travel industry XL Leisure Group, the UK's third-largest tour operator, went into administration on Friday.

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