* Valor says AA to renegotiate $1.6 bln debt with BNDES

* AA may return jets to Embraer, CEO Horton tells Valor

Feb 8 (Reuters) - American Airlines is renegotiating terms of $1.6 billion in debt owed to Brazil's state development bank to help it emerge more rapidly from bankruptcy in the United States, a Brazilian newspaper said on Wednesday.

American Airlines Chief Executive Thomas Horton, who was named in November to the top post at the third-largest U.S. airline, declined to say how the company plans to pay the BNDES, according to a report by Valor Econômico.

The airline's parent company, AMR Corp, wants to rework terms of the debt, which it incurred to finance the purchase of Embraer planes between 1998 and 2002, as part of its bankruptcy restructuring.

The company filed for bankruptcy in November, saddled with over $30 billion in debt and a flagging market for its business.

It could return some planes to Embraer and pay down a portion of the BNDES debt, Horton told Valor, naming one potential alternative the company is working with.

"Embraer will assist both American Airlines and BNDES in the reassignment of the aircraft," an Embraer press representative said via telephone, adding that the company sees American's restructuring as an opportunity for future sales of larger jets such as the Embraer 175.

Press representatives for American Airlines did not respond to requests for comment while a spokesman at Rio de Janeiro BNDES did not have a comment on the Valor report.