SAO PAULO, May 29 (Reuters) - Brazilian airlines Azul ( AZUL )

and Gol have informed local antitrust

regulator CADE of their new codeshare agreement and do not

expect hurdles to be imposed, Azul's ( AZUL ) chief executive told

Reuters.

The carriers, which each have around 30% of domestic market

share, unveiled the deal last week, covering all domestic routes

operated by one but not the other, along with their frequent

flyer programs.

The move also reignited speculation of a potential merger

between the airlines, which would need antitrust approval.

Azul ( AZUL ) said in a late Tuesday securities filing, after the

Reuters interview, that it had been in talks with Gol's parent

Abra Group to "explore opportunities."

Codeshare agreements, which allow airlines to sell seats on

each other's flights, do not require antitrust green light in

Brazil, but some have voiced concern about market concentration

and suggested the watchdog should look into the matter anyway.

"We went to CADE to explain what we are doing, and if they

decide to look at it, that is fine," Azul ( AZUL ) CEO John Rodgerson

said. "There is no overlapping routes, no pricing coordination.

So we don't see problems."

Rodgerson noted that Azul ( AZUL ) had a similar deal with rival

LATAM in 2020, when the COVID-19 pandemic hit the air

travel industry. That agreement fell apart the following year as

Azul ( AZUL ) unsuccessfully bid to combine with the Chile-based carrier.

Azul's ( AZUL ) new codeshare deal with Gol came after the latter

filed in January for bankruptcy protection in the United States,

amid struggles with heavy debt and delayed deliveries from

planemaker Boeing ( BA ).

But Rodgerson said the companies had been in talks for some

sort of agreement even before that, given their complementary

networks. Gol focuses on big cities such as Sao Paulo, Rio de

Janeiro and Brasilia, while Azul ( AZUL ) has a more dispersed network.

"We operate in some 100 cities where Gol doesn't, so things

will be able to flow much easier from now on," he said.

Analysts estimate that Azul ( AZUL ) flies alone on more than 80% of

its routes.

Brazilian airlines have enjoyed strong demand this year. In

March, Azul ( AZUL ) raised its estimate for core earnings, also citing

improving fuel prices and capacity growth.

The carrier expects to add two to three aircraft per month

from June until the end of the year, most of them Embraer ( ERJ )

, and is confident that demand will be good.