The German administrator of insolvent airline Niki said he still wanted to sell the leisure carrier to Aer Lingus and British Airways parent IAG.

This is despite a battle between Austria and Germany over where insolvency proceedings should be handled. 

An Austrian court ruled on Friday that the insolvency proceedings should be held there, throwing the deal to sell Niki into doubt. 

Intensive talks were held at the weekend with all parties, German administrator Lucas Floether said in a statement today.

He added that the Austrian court had no right to revoke the decision made by a court in another European Union country. 

Niki's German creditors, which account for more that 75% of its debt, and the staff council have already agreed the deal, Floether added, calling on the Austrian administrator to approve the sale. 

"If the package is unwound, then I believe the future looks bleak for Niki," he said. 

"IAG and Vueling are showing a lot of patience and good will, but everyone would understand if the investor wanted to exercise its legal right to withdraw from the purchase contract." 

Niki, a unit of collapsed German carrier Air Berlin, filed for insolvency in Berlin in December after Lufthansa scrapped plans to buy part of it. 

After renewed talks, IAG then agreed to buy Niki, founded in Austria by former motor racing champion Niki Lauda, and make it part of its Spanish budget carrier Vueling. 

Lauda has already said he would be willing to make another bid for Niki by a January 19 deadline set by the Austrian court.