TOKYO: Delta Air Lines has taken the lead in a bidding war with rival American Airlines to take a minority stake in struggling Japan Airlines (JAL), a newspaper reported on Friday.

JAL looks likely to accept capital from Delta, the world's largest carrier, and cross over to the SkyTeam airline alliance, the Asahi Shimbun reported in its evening edition, without citing any sources.

Asia's largest carrier, which currently belongs to the American Airlines-led Oneworld alliance, "is leaning toward" the view that it would be more beneficial to join a bigger alliance, the report said.

There was no immediate comment from JAL in response to the report.

Delta, which last month offered JAL a one-billion-dollar financial package, is now trying to finalise a deal, possibly early next year, the Asahi said.

But American Airlines and its investment partners could still be in the running, particularly if they offer a more attractive financial package, the daily said.

It is also uncertain if a JAL-Delta alliance would gain acceptance from Japanese and US anti-trust authorities, the newspaper added.

Earlier this week American Airlines chief executive Gerard Arpey said the carrier might boost its offer of a 1.1-billion-dollar financial lifeline for the cash-strapped Japanese carrier.

JAL, which last month reported its fourth straight quarterly loss, has been hovering on the brink of bankruptcy in a crisis blamed on the global aviation industry downturn, mismanagement and its huge pension obligations.

The recipient of three government bailouts since 2001, the airline has said it plans thousands of job cuts and a drastic reduction in routes.

It is also seeking more public funds as it restructures under the supervision of a government-backed turnaround body.