German weekly Wirtschafts Woche reports that Etihad plans to increase its stake in Air Berlin to 49.9%.
The Abu Dhabi-based carrier already holds almost 30% of the shares in Germany's second-biggest airline.
Wirtschafts Woche reported today that the plan would involve buying out small shareholders and delisting Air Berlin plc from the London Stock Exchange.
Large shareholders including former managers and travel firm TUI would retain a majority.
The magazine cited sources at Air Berlin for its report.
The company, which on Wednesday postponed the release of its annual results until next week, declined to confirm the Wirtschafts Woche report.
Spokesman Mathias Radowksi says Air Berlin is "currently in advanced discussions on options, which, if implemented, would have a substantial effect on the company".