Russian independent air carrier Transaero announced last week it struck up a code-sharing agreement with Continental Airlines – the fifth-largest U.S. carrier – along with other partnership deals with Air Kazakstan, Ural Airlines and KrasAir.

The deal with Continental envisages sharing routes and ticket sales on jointly agreed tariffs, Transaero Director Alexander Pleshakov said.

Under the agreement, Russian and Kazak airlines now tap into Continental's market, offering joint flights to 26 U.S. cities via mutual hubs in London and Frankfurt.

In return, U.S. travelers flying with Continental will get better access to Russia and the CIS through Transaero and regional airlines.

Passengers will also fly at a lower cost, officials said. Round-trip flights from Moscow to New York via London are set at $500.

Toubia Hachem, Continental's CIS representative, said the arrangement should be popular with oil executives from Houston, where the company has a hub.

Flying Continental to London, they can later switch to Moscow-bound Transaero and then one of its domestic partners, she said.

Transaero, set up in 1990, has enjoyed a steady growth on the market, actively leasing Boeing aircraft until hit by the financial crisis of 1998, when it had to reduce its fleet and shed some internal routes.

This year, Pleshakov said the company is on the mend and is resuming and expanding flights.

The company flew to 25 destinations in Russia, the CIS and abroad in 1999, a figure that will be increased by 25-30 percent this year, Pleshakov said.

Flights will be resumed to Frankfurt, St. Petersburg, Novosibirsk and Omsk, while the number of flights will be increased to Odessa, Cyprus and London, where the company will now be flying on a daily basis.

Transaero operates one Il-86 and seven Boeing-737s. Last year, the company signed a $150 million agreement with the Ilyushin-Finance leasing company for 10 new Tu-204-100 aircraft fitted with domestically produced PS-90A engines. Transaero will begin receiving the planes in 2001.

Last year, the company posted operating profits of 126 million rubles ($5 million) on turnover of 2.2 billion rubles ($77 million) and carried 572,000 passengers.

Speaking of the partnership, Pleshakov said he was wary of calling it an alliance, referring to Aeroflot's earlier announcement to join a global alliance with Delta, Air France, Korean Air and Aeromexico.

"This is a partnership, a commercial cooperation that we hope will offer new opportunities to [the airlines] involved," he said.