American adventurer Steve Fossett was rescued by a yacht Monday, one day after the balloon he was trying to fly around the world crashed into the Coral Sea.

Fossett told one reporter that his balloon had been struck by hail and lightning in a fierce storm, and it fell 29,000 feet into the sea.Fossett was picked up 500 miles off the east coast of Australia by the yacht Atlanta after completing two-thirds of his planned trip, spokes-woman Judy Jasper said at the millionaire's flight operation headquarters in St. Louis. He was to be taken to Townsville in Queens-land, Australia, she said.

"The rescue was very straightforward. Mr. Fossett is in good health," Australian Maritime Safety Authority spokesman Brian Hill said.

Earlier, Fossett had given a thumbs-up signal to a rescue plane from Sydney that reached the crash site. He also had been in regular radio contact with a Royal Australian Air Force Hercules C-130.

Fossett's balloon was heading toward its final destination in Argentina when contact was lost, said Alan Blount, director of mission control for the journey.

Fossett's balloon, Solo Spirit, stopped reporting its position and its emergency locator beacon sound-ed twice Sunday. The locator beacon, called an EPIRB, is either activated manually or by immersion.

Darren Curtis from The TV 7 Network in Australia, who was aboard the Australian plane, talked to Fossett via radio.

"He said he was caught in a giant thunderstorm with hail and lightning which actually ruptured his balloon. He fell 29,000 feet into the ocean," Curtis said. "He says when he hit the ocean, his balloon capsule caught fire and he had to evacuate into a tiny life raft."

A French military plane dropped a larger life raft to Fossett this morning, after reaching the downed balloon near the Chesterfield Islands. It circled Fossett until its fuel began to run low, then headed back to its base in New Caledonia.

The Atlanta will hand Fossett off to the New Zealand navy tanker Endeavour, which was about three hours behind the yacht.

The 60-foot yacht, skippered by Australian Laurie Piper, had been on its own trip around the world when it was alerted by a ham radio operator that Fossett was down in the area.

Seas were relatively calm but there was concern before the rescue because the area is near a shark-infested coral reef. Hill said Fossett came down near the Bellona Reefs, an uncharted region.