Virgin Atlantic, the British carrier part-owned by Richard Branson, is in talks about a surprise takeover bid for Flybe.

The regional UK airline - which flies in and out of Dublin, Cork and Knock - put itself up for sale last week due to growing financial pressure.

Sky News is reporting that Virgin Atlantic has opened discussions with Flybe's advisers about making an offer for the company, four years after announcing the closure of Little Red - an earlier attempt to crack the domestic UK market.

Sources said the transatlantic airline was pursuing an interest in Flybe because of the opportunities a tie-up would provide to feed passenger traffic into Virgin Atlantic's long-haul network, as well as its access to take-off and landing slots at London's Heathrow Airport - which are ring-fenced for domestic flights.

The two carriers already operate a code-share agreement aimed at improving access to Virgin Atlantic's long-haul routes for customers using the regional airline's flights into London Heathrow and Manchester.

Rothschild, the investment bank, is advising Virgin Atlantic on its interest in Flybe.

File photo of a Flybe plane

Although an offer from Virgin Atlantic for Flybe would not be large in monetary terms - the latter had a market capitalisation of just over stg£20m (€22.5m) at Thursday's closing share price - it would be a significant combination in a British aviation sector, which is seen as requiring further consolidation.

Rising oil prices and the weakening pound sterling have put airlines under intense pressure, with a deepening industry price war accentuating the squeeze.

UK-based Monarch Airlines went into insolvency in 2017, while more recently Primera Air - a budget carrier which began offering long-haul flights from British airports this year - filed for administration.

If Virgin Atlantic succeeded with an offer, it is not clear if the the Flybe brand would be maintained.

Flybe offers several routes from Dublin, Cork and Knock.