German carrier Lufthansa is poised to take control of Bmi, the UK airline controlled by Sir Michael Bishop for the past 30 years, in a deal that could value the business at £500m-£600m.

Lufthansa yesterday gave its clearest signal yet that it intends to exercise options to buy Sir Michael's stake of 50pc plus one share by June 2009 - even though Bmi insisted that comments by Lufthansa's chief financial officer Stephan Gemkow had been misinterpreted.

"There are options that put us in the position to acquire the majority of Bmi over a foreseeable timeframe," Mr Gemkow said as Lufthansa reported first-quarter results. "We are determined to exercise these options. Beyond that there is no need to hold talks."