The Communications Workers Union has urged Eircom stakeholders and lenders to consider Singapore Technologies Telemedia’s (STT’s) offer to restructure and ultimately save the business.
Eircom’s lenders first and second-lien lenders have voted to extend a “covenant waiver” on the company’s massive €350m debt until 31 January, enabling it to avoid liquidation. There are a number of proposals on the table.
Eircom’s majority shareholder STT has offered to buy back the business, provide a €200m rescue investment and is in talks with ESOT (Employee Share Ownership Trust), which has one-third of Eircom shares, about a joint bid.
A chance to rebuild Eircom
Steve Fitzpatrick, General Secretary of the Communications Workers’ Union, said: “This proposal represents the best opportunity to rebuild Eircom and provide a secure future for its customers and its workforce. STT are the first telecommunications company to be involved in Eircom since its disastrous privatisation and there is little doubt that the company needs the industry know-how and technical ability that STT brings to the table.”
He said: “STT has also worked at developing a professional relationship with the industry in Ireland, including the regulator ComReg and the Department of Communications. Its investment plans including the roll out of a next-generation broadband network which is an absolute necessity for Ireland, and critical to future inward investment and the ultimate recovery of the Irish economy.”
Fitzpatrick urged all the parties engaged in negotiations on Eircom’s future to redouble their efforts so that finality and closure can be achieved from the ongoing restructuring process.
He said: “It has been and is a very worrying and stressful time for all of the staff who had committed so much to keeping the business on track over the last number of years through pension remediation, pay freezes and pay cuts.
“It is now time for the continuous distraction of these long-running financial structural discussions to be brought to a conclusion and allow the company to be run in an straightforward commercial manner.”
He added: “This long-running saga should and could have been resolved in the summer and in the autumn with the acceptance of one of the earlier bids tabled by STT. The ongoing euro crisis, and the lack of interest from any other key industry players, has resulted in the most recent impasse which should have been avoided.”