Kingfisher Airlines has confirmed that it is in talks with Etihad Airways about a possible equity investment, amid speculation that the latter is close to buying a 48% stake in the beleaguered carrier.
In a statement on the Bombay Stock Exchange, however, it adds that the Middle Eastern carrier is one of several investors it is in discussions with, and that matters are only at "negotiation stages".
"No agreement has been reached with either Etihad or any other airlines," adds Kingfisher.
Kingfisher has, for over two years, been trying to raise the much-needed capital.
The airline grounded its fleet and suspended operations on 1 October after employees went on strike as a result of the non-payment of salaries. India's directorate general of civil aviation then suspended Kingfisher's operator certificate on 20 October after the airline failed to "satisfactorily" respond to a show cause notice.
The carrier's stock, however, rose by 4.7% on 11 December after a local media report said Etihad is close to buying a 48% stake in it, and that a decision is likely to be made next week.
Etihad is not commenting on the matter, but its chief executive James Hogan said in an interview a week ago that the airline is in talks with Indian carriers and is keen to take up equity stakes in them.
Etihad is also in talks about a comprehensive tie-up, including the possibility of taking an equity stake in Jet Airways. Sources had told Flightglobal that negotiations have been ongoing for weeks and that an agreement could be reached by end-2012.