V Ships, one of the worlds major ship management firms, with offices on Belmont Hill in Douglas has dropped out of a contest with Caledonian McBrayne to run the Clyde and Hebrides ferry services.

At the same time, its confirmed that it is "up for sale" following rumours over the company's future.

It has retained N M Rothschild to handle the sale of the business, after first appointing the investment bank in August 2006 to conduct a strategic review. The business is estimated to fetch up to ?250m, and is expected to attract offers from financial investors rather than trade bids.

Close Brothers Private Equity acquired V Ships in 2003 for ?95m through a management buy out, and hold a 45% stake in the company.