General Electric Co. wants to take part in talks headed by the Brazilian government on the fate of the country's flagship airline, Varig, Vice President Jose Alencar said on Monday after meeting with the U.S. company's CEO.

According to Alencar, GE Chief Executive Jeff Immelt showed interest in Brazil's domestic aviation market and on the general outlook for the economy during his meeting in the capital, Brasilia.

GE wants to be invited to future meetings about Varig, said Alencar, who is also in charge of commercial aviation in Brazil as its defense minister.

Immelt declined to make any comments to the media.

Varig owes GE about 600 million reais (US$222 million), making the industrial, financial and media group one of Varig's largest private creditors. Overall, the airline has about 6 billion reais in debt it is struggling to pay off.

The Brazilian government is searching for what it calls a "market-based" solution to Varig's woes. It is waiting for Varig to turn in its own proposal.

One proposal being discussed would turn Varig's creditors, such as GE, into shareholders.

Alencar added Brazilian bank Unibanco also had been invited by Varig to the talks.

(From Reuters, January 10, 2005)