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DUBAI, United Arab Emirates (AP) — Fast-growing Gulf airline Etihad Airways said Wednesday it had reached a deal in principle to buy a 49 percent stake in struggling Italian carrier Alitalia, expanding its collection of foreign investments to one of Europe's most recognizable aviation brands.

Etihad is owned by the government of Abu Dhabi, the oil-rich capital of the seven-state United Arab Emirates federation. It has been expanding both by building its own route network and through a rapid-fire series of investments in airlines from Europe to Australia.

In a joint statement, Etihad said it and Alitalia "have agreed the principal terms and conditions of a proposed transaction" for the near-half stake in the Italian flag carrier following months of negotiation.

"The airlines will now move to finalize the transactional documents, that will include the agreed upon conditions, as soon as possible," the airline said.

The airlines did not disclose the proposed terms of the accord, which they said remains subject to regulatory approvals. European Union authorities will want to ensure any deal doesn't violate competition rules.

Etihad already has stakes in a number of European carriers, including Air Serbia, Ireland's Aer Lingus and Germany's second largest airline, Air Berlin. It also is a partial owner of Virgin Australia, Air Seychelles and India's Jet Airways.

Etihad is smaller than its Gulf competitor Qatar Airways and the region's largest carrier, Dubai-based Emirates.

Italian Transport Minister Maurizio Lupi earlier this month told Italy's state RaiNews that Etihad's investment could reach about 600 million euros ($816 million) and would revitalize Rome's Fiumicino and Milan's Malpensa airports.

A successful deal would likely involve banks renegotiating more than 500 million euros ($700 million) in debt, canceling some and converting the rest into shares, according to Italian media reports.

Lupi issued a statement Wednesday saying he and Italy's labor minister would set up a meeting soon to discuss layoffs, which could face resistance by labor unions. He also reported progress with banks in resolving the debt issue during a meeting on Tuesday, but he did not provide details.

"It is ever more clear that this marriage needs to go ahead, because it is by now evident to all that it involves a big industrial investment with concrete prospects for our company," Lupi said.

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Associated Press writer Colleen Barry in Milan contributed reporting.

ALBUQUERQUE, N.M. (AP) — An Arizona company says it has successfully completed the first scale test flight of a high-altitude balloon and capsule being developed to let tourists float 20 miles above the earth.

World View Enterprises of Tucson said Tuesday that it launched the flight last week from Roswell, New Mexico.

CEO Jane Poynter says the system broke the world record for highest parafoil flight, lifting a payload one-tenth of what is planned for passenger flight to 120,000 feet.

Poynter says the company is still planning to begin its $75,000 per-person flights in 2016. The balloons will lift a capsule carrying six passengers to about 100,000, where they will float for about two hours.

She says the company hasn't yet decided where its operations will be based, although Spaceport America in New Mexico is among the options.

MOSCOW (AP) — On Russian President Vladimir Putin's demand, the upper house of the Russian parliament on Wednesday canceled a resolution allowing the use of military in Ukraine, a move intended to show Moscow's eagerness to de-escalate tensions and avoid a new round of Western sanctions.

Putin had said his request, made a day earlier, was intended to help support the peace process in Ukraine, which began Friday with a weeklong cease-fire.

Putin needs to show his support for Ukrainian President Petro Poroshenko's peace plan ahead of Friday's European Union summit to avoid further Western sanctions. The EU has warned it could introduce new sanctions that would target entire sectors of the Russian economy if Moscow fails to help de-escalate the crisis.

The vote came as NATO foreign ministers gathered in Brussels, warning that more sanctions were possible and considering ways to bolster Ukraine's military.

German Chancellor Angela Merkel told lawmakers Wednesday that Putin's move to rescind the permission for using military force in Ukraine was an "important psychological point," but that progress toward a solution remains slow and EU is still prepared to increase sanctions.

Merkel, who was set to have a phone call with Putin, French President Francois Hollande and Poroshenko later in the day, said the EU will do everything possible to help find a diplomatic resolution, but added that "if nothing else helps, sanctions could return to the daily agenda, and this time at the third level."

Two previous rounds of U.S. and EU sanctions imposed asset freezes and travel bans on members of Putin's inner circle over Russia's annexation of Crimea. The next round, which would impose penalties for entire sectors of the Russian economy, could be far more crippling.

Maintaining pressure on the Kremlin, NATO's secretary general said Wednesday there are "no signs" Russia is respecting its commitments over Ukraine.

Speaking after the NATO foreign ministers meeting, Anders Fogh Rasmussen urged Russia to "take genuine and effective measures to stop destabilizing Ukraine ... create conditions for the peace plan to be implemented ... end its support for armed separatist groups, and ... stop the flow of weapons and fighters across its borders."

"This is a real opportunity to de-escalate the crisis caused by Russia's aggression, and Russia must step back in line with its international obligations," Rasmussen said.

He added that the meeting approved moves to help build Ukraine's military capacities, including by creating trust funds.

"We endorsed a package of additional measures to strengthen Ukraine's ability to defend itself," he said. "This includes the establishment of new trust funds to support defense capacity building in critical areas such as logistics, command and control, and cyber defense and to help retired military personnel to adapt to civilian life."

On Tuesday, Putin urged Ukraine to extend the truce and sit down for talks with the rebels. He argued that the Ukrainian demand that the insurgents lay down their weapons within a week was unrealistic, explaining that they would be reluctant to disarm for fear of government reprisals.

The Russian leader also called on Ukraine to adopt constitutional amendments and other legal changes that would protect the rights of Russian-speakers in the east.

Poroshenko promised Wednesday that he would submit draft constitutional amendments offering broader powers to the regions and voiced hope for quick approval by parliament. He said that the Russian parliament's move to rescind the sanction for the use of force was the result of his peace plan.

Speaking after a meeting of the NATO-Ukraine Council in Brussels, Ukrainian Foreign Minister Pavlo Klimkin hailed the Russian parliament's vote as a "positive step," but urged Moscow to also stem the flow of militants and weapons across the border. "It has to be stopped in order to enable further effective de-escalation of the situation," he said.

Ukraine and the West have accused Russia of supporting the rebellion with troops and weapons, but Moscow has denied that.

The cease-fire has been repeatedly broken by sporadic clashes, and it was violated again Tuesday when rebels used a shoulder-fired missile to down a Ukrainian military helicopter, killing nine servicemen. The attack, which came a day after the rebels pledged to respect the cease-fire, prompted Poroshenko to warn that he may end the truce ahead of time.

Putin's March 1 request to parliament for authority to use the military in Ukraine came days after Ukraine's pro-Russian president was chased from power following months of street protests. Russia sent troops that quickly overran Ukraine's Black Sea peninsula of Crimea, setting the stage for Russia to annex it after a hastily called referendum. In April, a mutiny erupted in eastern Ukraine, where pro-Russian insurgents seized official buildings, declared their regions independent and fought government troops.

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John-Thor Dahlburg in Brussels and David Rising in Berlin contributed to this report.

BELFAST, Northern Ireland (AP) — For Queen Elizabeth II, one throne is enough.

The United Kingdom's 88-year-old monarch toured the Belfast sets of the hit HBO series "Game of Thrones" and met many of its stars Tuesday beside the show's sword-covered seat of power, the Iron Throne.

Unlike many visitors to Belfast's Titanic Studios, the monarch declined to take a seat on the throne created for the ruler of the mythical Seven Kingdoms.

"Game of Thrones" creators David Benioff and Dan Weiss escorted the monarch through the show's custom-made armory, hangars of costumes, and sprawling sets used to shoot the program's interior scenes and perilous ice-cliff ascents — part of the biggest TV production ever mounted in Europe.

She chatted with actors Lena Headey, Maisie Williams, Sophie Turner, Kit Harington, Rose Leslie and Conleth Hill.

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