Eircom sets share price for stock exchange reflotation


4 Mar 2004

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Irish incumbent telco Eircom is to refloat on the Dublin and London stock exchanges for a share price of between €1.48 and €1.75, according to the company’s prospectus.

Last week, Valentia said it intends to raise around €300m in gross proceeds through a primary offer of shares and will change its name to Eircom Group plc. According to Valentia, it intends to raise €831m via a global offer, with the primary offer to raise €300m and a secondary offer of €531m.

It is understood that a definite price is expected to be set on 18 March and conditional dealings are expected to commence on 19 March. The company also declared its intention to pay an ordinary share dividend of €81m in aggregate for the financial year ending 31 March.

Last week Valentia said that in the nine-month period ended 31 December 2003, Eircom, the operating entity of Valentia, had consolidated turnover of €1.2bn and EBITDA of €450m, with cashflows associated with capital expenditure of €150m. As of 31 December 2003, net debt at Valentia Telecommunications, the immediate subsidiary of Valentia, was €2.1bn. Valentia is 70pc owned by Tony O’Reilly, Providence Equity Partners and George Soros.

Citigroup, Deutsche Bank, Goldman Sachs International and Morgan Stanley have been appointed as Joint Bookrunners to the offer, with Goldman Sachs International and Morgan Stanley also acting as Joint Sponsors.

Quoting quarterly data from ComReg, Eircom said that it has a market share of 80pc of the Irish fixed line market, based on turnover, with some 2m fixed line telephone access channels in service. Of these, 1.6m were basic public switched telephone network (PSTN) lines and the remaining 400,000 were more advanced ISDN channels.

In terms of broadband rollout, Eircom revealed a near-term ambition to have 100,000 broadband connections rolled out by December this year.

By John Kennedy