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Brazil's airline bailout falls again in value to $680 million -source

SAO PAULO, May 13 (Reuters) - Brazilian state development bank BNDES on Wednesday offered airlines a 4 billion reais ($680 million) rescue package, less than half of what was initially anticipated, a source with knowledge of the matter said.

The plan has shrunk as time has gone by, from 10 billion reais, then to 6 billion reais and now to 4 billion.

Under the terms of this plan, BNDES will provide 60% of the rescue line, while private banks will contribute with 10% and the remaining part will come from capital markets investors.

The rescue plan will be offered to Brazil's top three airlines, Gol Linhas Aereas Inteligentes SA, Latam Airlines Group and Azul SA. It may still change, depending on how talks with airlines evolve, the source said.

Previously, negotiations between BNDES and airlines involved a 10 billion reais credit line.

Besides debt, the rescue plan includes instruments which can be converted in equity.

Azul said it had received a revised proposal on potential aid is currently revising it. Gol declined to comment on the matter. BNDES and Latam did not immediately comment on the matter.

Bloomberg reported earlier on Wednesday on the rescue plan amount. ($1 = 5.8852 reais) (Reporting by Carolina Mandl and Marcelo Rochabrum; Editing by Lincoln Feast.)