Aer Lingus is expected shortly to appoint a specialist recruitment firm to hire a replacement for its former chief executive, Mr Garry Cullen, who resigned last month.

It is understood that a subcommittee of the airline's board has approached five such companies, in Ireland and abroad, to tender for the contract.

Meanwhile, a "code-sharing" arrangement linking the reservation systems of Aer Lingus and British Airways comes into effect on March 26th. This means that transfers booked by Aer Lingus passengers to certain British Airways services will effectively function as direct flights.

The Government's advisers for the airline's flotation, AIB Capital Markets and Salomon Smith Barney, have also engaged in preliminary dialogue with its trade unions on the question of an employee share option plan (ESOP).

The trade unions have appointed their own advisers for the flotation. Legal advice will be provided by Mr David Beattie of O'Donnell Sweeney Solicitors and its financial adviser will be Mr Greg Sparks of accounting firm Farrell Grant Sparks. Under the code-sharing arrangement, Aer Lingus's "EI" code will be used by its passengers on British Airways services between Heathrow Airport in London and nine cities in Germany, Italy, France, Austria, the Czech Republic and Hungary. The code will also be used on CityFlyer Express services with Gatwick Airport in London, and Dublin.

Similarly, British Airways will place its flight codes on nine Aer Lingus services between Britain and Ireland.

Aer Lingus claimed the agreement would enable its passengers to gain from "smoother transfers" between its services and those of British Airways. Business class passengers will also have access to airport lounges operated by both airlines.

The new system, established as part of the One-World Alliance which Aer Lingus joined last year, will also allow for reciprocal arrangements on the airlines' frequent-flyer programmes.