Eircom valued at €1.14bn

19 Mar 2004

Ireland’s largest telco Eircom has priced its shares at €1.55 for its return to the public markets today on both the London and Dublin stock exchanges. The price values the company at €1.14bn.

The price leans towards the lower end of the €1.48 to €1.75 range advertised by the company in recent weeks.

It is understood that conditional dealing in the shares will begin at 1pm today, while unconditional dealing is expected to start next Wednesday at 8am.

The initial public offering of 467m shares will raise approximately €215m for the group. The company also plans to raise a further €85m from the issue of shares for an employee ownership trust. The Employee Share Ownership Trust owns around 30pc of Eircom.

It is believed that the venture capital firms that backed Valentia’s acquisition of Eircom in 2001 are selling almost all of their stake in Eircom. A document released to institutions by Eircom around the time of its bonds issue last year claims that US venture capitalists and financiers that invested approximately €900m in Valentia’s bid to acquire Eircom in 2001 have already received 75pc of their initial investment back and stand to secure a further payoff of up to €1.4bn if the upper end of Goldman Sachs’ valuation expectations are to be released.

By John Kennedy