Eircom ends sales process – lenders’ new plan supported ‘in principle’

14 Mar 2012

After completing the M&A process with no satisfactory bids apparent, Eircom has in principle welcomed revised proposals from first lien lenders that may kick start a €400m investment plan to fibre-connect 1m homes in the next 3-4 years.

ERC Holdings Ltd said it was in principle supportive of a revised proposal submitted by first lien senior lenders.

The next step in the coming weeks is to secure a sustainable financial structure for Eircom to execute on its plans.

The first lien lenders’ proposal is understood to be based on strategy for the company that centres on a €400m investment that will see fibre reach 1m premises around Ireland.

It is also understood that the plan – originally meant to be executed within a four-year period – has been shaved down to three years for execution.

While the plan has been accepted in principle, it still has to be formally accepted by the syndicate that owns the incumbent operator.

Sources close to the company welcomed the development and said that court hearings in the coming weeks should formalise the arrangement.

They are hopeful it will be endorsed by the broader syndicate because it means the lenders have come up with a proposal that the committee thinks is viable.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years