The closure yesterday of the Centre for Software Engineering (CSE) in Dublin City University, with the loss of 12 jobs, has been described as a major setback for IT in Ireland. But a DCU spokeswoman last night told The Irish Times that negotiations with a potential buyer were in progress.

"The board is in discussion with a prospective buyer and they are at a very advanced stage of negotiations," she said. The CSE, which is a campus company of DCU, was established in 1991 to promote best practice in software engineering. The centre's income came primarily from high-level training within the IT sector and it also received some Government funding. But it is believed the firm was operating at a loss over the past two years.

Mr Frank Cronin, chief executive of the Irish Computer Society, said the closure was a "backward step". "In addition to 12 jobs being lost and the cancelling of many valuable projects, the damage to our international reputation is immeasurable," he said.