Aer Arann and Aer Lingus are expected to be the main contenders to take over running the Dublin-Donegal air service. Bids for the business had to be submitted by 5.30 p.m. yesterday. The service had been run by EI Air Exports, which is being wound up following a petition to the High Court by the Revenue Commissioners who are owed £706,000. It is thought that three parties are interested, possibly including Bright Air, a small airline operator with operations in Donegal.

The route receives considerable financial aid, which is approved by the EU as part of a strategy to develop such regions economically.