Cyprus Airways’ future hangs in the balance after its two potential rescuers reportedly pulled out.

Ryanair and Greece’s Aegean Airways had expressed interest in a rescue deal for the troubled carrier, but both have now said they are not interested in a deal.

The sticking point is thought to be around €75 million that the Cypriot government has spent baling out the airline, which is illegal under EU rules on state aid for failing airlines. The European Commission may ask for the sum to be repaid by any potential buyer.

Ryanair has made no secret of its ambition to enter the Cyprus market, basing a fleet of aircraft on the island and flying them the short hops to the Middle East to cater for the weekend break market to Cyprus.

Cypriot Finance Minister Harris Georgiades told the Cyprus press the government was preparing for the worst-case scenario and was preparing to secure the country’s air links in case its national carrier is grounded.