What I meant John21UK, is that I think that this is a sign of desperation at Bahrain Air and a last chance for a rescue for the airline's investors and other stateholders before closing shop.
As far as a business decision goes, airline mergers can be ugly affairs and I can't see what kind of value Bahrain Air would bring to Gulf Air. From a business standpoint, better to let the company fail, then pick up any pieces that may be of interest (if there are any).