NEW DELHI: Jet Airways and Air Sahara, India's two leading private carriers, are likely to forge a "strategic alliance" in the near future.

Though Air Sahara has said that no deal has been signed with Jet Airways, it maintained that discussions were on with Jet Airways for a "strategic alliance'' between the two private airlines which also have some international flights on their schedule.

"No deal has been signed with Jet Airways," Vice President of Air Sahara, Alok Sharma, told reporters here on Wednesday. Jet Airways Executive Director, Saroj Datta, also confirmed that no deal had been signed between the two carriers. Aviation sources said that the issue of Jet-Sahara strategic alliance would come up at the board meeting of Jet Airways, likely to be held this month-end.

Asked about the strategic alliance, Mr. Sharma refused to divulge the details. "In today's aviation industry, every airline needs to grow fast. We have looked at many opportunities and within this pursuit, we are talking to Jet for a strategic relationship for a better tomorrow," he said.

Mr. Sharma said that as the talks progressed, the relationship would unfold. "At this point, I cannot go beyond this since we are in discussions right now," he added.

Aviation industry circles have been agog with speculation about Air Sahara takeover bids. Consultant Ernst and Young had evaluated Air Sahara at $750 million to $1 billion. Kingfisher Airline chief, Vijay Mallya, who had earlier made known his desire to acquire Air Sahara opted out of the race last week, saying he was not interested in Air Sahara any more.

Reports in a section of the media had claimed that Jet Airways was willing to buy Air Sahara for about $560 million (about Rs. 2,520 crore) as it would push up Jet's market share to over 50 per cent.

With eight domestic carriers already in operation and an equal number waiting in the wings to take to the skies, there have been concerns over dwindling market shares of leading private carriers.

While Jet's market share has dwindled to nearly 37 per cent, public sector Indian's has come down from nearly 48 per cent to 33 per cent. Jet and low-cost carrier Air Deccan too are said to be in talks for `cooperating' in route rationalising.

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