Ryanair's bid to buy out Aer Lingus escalated this week into a war of words between the bosses of the two airlines.

Ryanair's Michael O'Leary claimed Aer Lingus faces a bleak future unless it becomes a subsidiary of his company, but defiant Aer Lingus boss Dermot Mannion said his airline is not for sale.

The exchanges formed chapter three in the power struggle between the two companies since O'Leary announced a €748 million bid two weeks ago to buy out Aer Lingus.

He followed up that offer last week with a declaration that if he gets control of Aer Lingus he will sack its board members except chairman Colm Barrington.

When Mannion hit back this week O'Leary stepped up his attack and pointed out that Aer Lingus faces financial losses for this year and 2009 and its management had recently admitted they needed a partner.

He said that if Aer Lingus entered into a partnership with a big European carrier it would become a small part of a non-Irish group.

But with Ryanair it would form one big Irish airline that would be one of the four largest in Europe.

O'Leary said if his offer is accepted, Ryanair would guarantee that it will keep vital slots at London's Heathrow Airport open and would also reduce Aer Lingus fares.

He claimed Aer Lingus employees would get €137 million through their shareholding, while the government would get ?188 million.

For Aer Lingus, Mannion said he does not expect Ryanair's takeover bid to succeed, that Aer Lingus was one of the strongest airlines in Europe and there was no need for a merger with Ryanair.

He said there is unity among the board, management and staff at Aer Lingus that it is not for sale.

Mannion also said he was confident he would be staying on as chief executive of the airline for the foreseeable future.

He said that an independent Aer Lingus was much better able to serve the interest of the Irish consumer and that the airline would put forward to shareholders an independent profitable growth agenda.

Mannion was given full public backing by Aer Lingus board chairman Colm Barrington, who was clearly not impressed by O'Leary's pledge to keep him on board if there is a merger.

Barrington said there was nothing new in O'Leary's offer. "It is the usual stream of invective, spin and misrepresentation that we expect from the people at Ryanair," he said.

"It also fails to address the recent EU prohibition decision which found emphatically that Ryanair wants to destroy consumer choice.

"Aer Lingus is and will continue to be a strong independent airline. Ryanair clearly needs Aer Lingus but we do not need Ryanair."