INTERVIEW - Garuda says in talks with 4-5 airlines to partne

OSAKA, Japan (Reuters) - Indonesia's troubled flag carrier Garuda Indonesia said on Friday that it and its shareholders are in talks with four or five airlines about strategic partnerships.

State-run Garuda, which like many airlines has been hit by soaring fuel prices, had debts of around $800 million as of August, most of it to the European Credit Agency.

Transport Minister Hatta Radjasa said in January that Indonesia wants to inject funds into Garuda and may also sell a stake, possibly through an initial public offering.

"For Garuda, shareholders have given indication that we are open to strategic partnership," Chief Executive Emirsyah Satar told Reuters at an airline conference. "Moving forward, this is the main agenda for Garuda itself."

"Unfortunately I can't disclose the names, but we are talking about ... up to right now four to five potential partners. Some of them are airlines in this region and some are not in this region. They are already discussing with the government."

Satar also said Garuda is trying to receive rights to reopen European routes by the end of next year, particularly to Amsterdam.

"Between Indonesia and Holland there is a historical linkage, and that is the place we go first."

Garuda said in August it aims to reduce costs by 5 to 10 percent next year partly by introducing fuel efficiency measures.

The cost-cutting efforts are in line with the government's efforts to help the ailing airline which defaulted on a $55 million debt payment at the end of 2005.

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