World Cup fans will be flown home, even if Varig goes into liquidation

The workers group, which also includes foreign investors offered $449m (�244m) for the beleaguered firm - well below the $860m minimum asking price.

Judge Roberto Ayoub is to spend a week studying the employees' proposal of how they will finance the deal.

Other groups, including Portuguese airline TAP, have also met the judge.

A court spokesman said the groups were considering entering into a partnership with NV Participations, representing the TGV (Trabalhadores do Grupo Varig) employees' association.

Rescue plan

If the bid collapses, Varig could go into administration.

The Brazilian government has revealed a contingency plan to aid passengers holding Varig tickets if this were to happen.

They include flying 5,000 football fans already booked on flights to and from the World Cup in Germany.

The struggling carrier's domestic and international assets, including 52 aircraft, are at stake.

But the new owner would not have to assume any of the airline's estimated $3.5bn debt.

Varig has been under bankruptcy protection for a year.

It was the top airline in Brazil until 2004, but was then overtaken by TAM and later by Gol.

Shrinking at home

The airline has suffered financial problems for years because of rising costs and growing low-cost competition.

It now has just 16.7% of the domestic market, but remains the leading Brazilian carrier internationally, with a 66.4% share.

Last year it cut 13% of its 12,000-strong workforce in an effort to stave off bankruptcy.