Aerolineas not worthy of payment-Argentine official

BUENOS AIRES, Aug 6 (Reuters) - Argentina's transport secretary said on Wednesday the government should not have to pay Spanish travel group Marsans anything in the planned takeover of faltering carrier Aerolineas Argentinas.

The government said last month it had reached an agreement to buy all of Marsans' shares in Aerolineas, the country's biggest airline. But the two sides are hashing out a price for the company, which has about $900 million of debt.

"Aerolineas Argentinas has been greatly drained. Obviously I think that nothing should be paid but that will be determined by the appropriate state agencies," Transport Secretary Ricardo Jaime told a congressional committee.

The executive branch sent a bill to Congress to reestablish state control over Aerolineas and its sister company, Austral. The legislature will also have to approve the amount to be paid for the airline.

Aerolineas and Austral operate 80 percent of domestic flights and employ some 9,000 workers. They compete with Chile's LAN Airlines LAN.SN (LFL.N),

Center-left President Cristina Fernandez said the state had no other option but to buy out Marsans because the indebted airline was behind on its salary payments.

In recent weeks, flight delays and cancellations affected thousands of passengers in Argentina, and employees said some planes were grounded due to a lack of upkeep.

Under former President Nestor Kirchner -- Fernandez's husband and predecessor -- the government began nationalizing public service companies such as the post office, a major water and sewage company, and a suburban railway.

(Reporting by Cesar Illiano; Writing by Hilary Burke, editing by Richard Chang)