The future of Aer Lingus will be decided in the early autumn, the Minister for Transport, Mr Brennan, has confirmed. Mr Brennan said he was "acutely aware" of the very serious issues that needed to be resolved at the State-owned airline.

"In the early autumn, we will take a decision," he told RTÉ radio yesterday. The Minister did not rule out the possibility that Aer Lingus would be sold in a management buyout (MBO) but indicated that a decision would first have to be made on whether external investment was the best option for the company.

Three Aer Lingus executives - Mr Willie Walsh, chief executive, Mr Brian Dunne, chief financial officer and Mr Séamus Kearney, chief operations officer - proposed an MBO earlier this month. This triggered high-level consideration of the airline's future.

Further spice was added to this mix yesterday when the Sunday Independent reported that British Airways would consider a takeover of Aer Lingus if it was put up for sale. British Airways chief executive, Mr Rod Eddington, said the firm would not make a move until the Government made clear its plans for Aer Lingus.

"My starting point is what the Irish Government want to see happen. When we know the answer to that, we'll be able to reflect on whether we'd want to participate or not," Mr Eddington said.

The Cabinet sub-committee set up by the Government to review the Aer Lingus situation met for the first time last week.

Its members are the Taoiseach, Mr Ahern, the Tánaiste, Ms Harney, the Minister for Finance, Mr McCreevy, the Minister for Arts, Sports and Tourism, Mr O'Donoghue and Mr Brennan.

The leadership skills of Mr Walsh have meanwhile been recognised by well-known aviation magazine, Airline Business Magazine. Mr Walsh received this year's Executive Leadership Award from the magazine at a ceremony in London last night. The award was won in 2003 by Mr Eddington.