Hungary's loss making national airline Malev signed a letter of intent on Tuesday to join the oneworld airline association led by American Airlines and British Airways, Malev said.

"It will take between six to 18 months for us to gain full membership but I'd put it closer to six months than 18... everything should be in place by the summer, 2006 schedule," Malev Chief Executive Janos Gonci told a news conference.

"The alliance has reviewed Malev's 2005 business plan and concluded it was realistic," Gonci said.

Malev expects to significantly improve its financial standing from membership as its plans code shared flights with alliance members and sees joint marketing.

Hungary's government has twice failed to sell Malev over the past year and is now conducting negotiations with strategic investors to sell the airline.