Lan and Tam are considering jointly bidding for troubled Brazilian airline Varig

, according to a Dow Jones Newswire report, citing local Brazilian media. Tam has become Brazil's largest airline in the wake of Varig's collapse and Lan is a leading South American airline. "If the transaction were to take place, Lan would gain access to this large, growing, and important South American market, while TAM would have a further vehicle for growth," according to a research note from Calyon Securities analysts. "Even rival Gol could benefit, in that the transaction could bring stability in pricing to the Brazilian market."