Vienna/Paris  - Air France-KLM has dropped its bid for Austrian Airlines AG, a spokesman said in Paris on Tuesday.

With the French-Dutch airline out of the race for buying the 42.75-per-cent stake of the Austrian flag carrier currently owned by the state, German Deutsche Lufthansa AG and Russian carrier S7 are likely the only other contenders.

However, Air France-KLM had informed Austrian Airlines that it was interested in continuing talks, the spokesman said.

Earlier, Air France-KLM had complained about the high price and a lack of transparency regarding the Austrian company's books.

Tuesday was the deadline for submitting the bids, while final price offers have to reach Vienna by Friday.

Austria's state holding OeIAG, which is selling the stake in Austrian Airlines, is scheduled to announce the result of the takeover process next Monday.

Mainly as a result of high fuel costs, Austrian Airlines is set to end the year with a deficit of 125 million euros (178 million dollars). (dpa)