The company behind Dublin's Aircoach bus service plans to spend €5 million introducing two routes linking the capital with Portlaoise and Cork over the next two months.

Coach operator Last Passive, the company behind Aircoach, this week sold a 90 per cent stake in the business to UK player FirstGroup for €15 million. Last night, Aircoach managing director Mr John O'Sullivan revealed that it had agreed the terms of the licences for two new routes with the Department of Transport, and was in talks regarding several more inter-city services.

Its new licences are for routes serving Cork and Dublin, and Portlaoise and Dublin Airport, the destination that Aircoach serves from the centre of the capital.

Mr O'Sullivan estimated that the new routes would require 12 buses, representing an investment of €5 million. He said the company intended to have both services up and running in December or January. Last night, Mr O'Sullivan explained that joining forces with FirstGroup would give his company the fire-power needed to cash in on the planned liberalisation of 25 per cent of the Dublin bus market.

"That would require an investment of €50 million," he said, adding that Last Passive would have been able to raise this money on its own.

The Minister for Transport, Mr Brennan, is committed to franchising out 25 per cent of the capital's public transport market. He is due to bring the legislation required for this and the break-up of State public transport company CIÉ before the Oireachtas early in the New Year.

He had originally planned the partial opening up of the Dublin market to be completed by next January. But a spokesman yesterday said it was more likely to be mid-2004. He blamed trade union opposition for the delay.