The future of Stobart Air, formerly known as Aer Arann and which runs the Aer Lingus Regional commuter service, remains literally 'up in the air' following the rejection of a management buy-out plan and the resignation of the airline’s chief executive behind the proposed buy-out.

It confirmed yesterday evening that Sean Brogan is to leave Stobart. It’s understood he had obtained financial backing for a €65m management buy-out but the plan was rejected by the board.

Mr Brogan is understood to have begun planning for an MBO after one of Stobart’s larger shareholders, the financial services company Invesco signalled last year that it wanted to sell its 40% stake.

The UK transport and logistics company Stobart is the largest shareholder in the airline with 45%.

It bought Aer Arann out of examinership in 2010 on the basis it could use the carrier to serve London Southend Airport, which it also owns. Aer Arann founder, Padraig O’ Ceidigh holds a 5% stake.

Stobart Air returned to profitability last year – the bulk of its passengers are carried under franchise for Aer Lingus on short-haul routes within Ireland and to Britain and France.