Eircom is Sold

Patrickof

Looks like eircon is sold for €2.4bn, and the ESOT gets to hold on to 35% - the directors have said they'll recommend the offer to shareholders - according o the Irish Times, not yet anything on the eircom site.

Sponge Bob

so what They are now carrying amost €1000 of debt for every man woman and child in this country .

http://www.rte.ie/business/2006/0523/eircom.html

Babcock & Brown was taking on €3.8 billion in debt for the acquisition, though this included existing Eircom debt

Biddy has leveraged her fat arse a tad as well.

the ESOT will have 35%, up from its current level of just over 20%.

Thats a fairly big bite of the turkey. The ESOT would have had to borrow some €250m-€300m to fund that increase in its stake. The reason why the ESOT felt it had to do that has a lot to do with Biddys pension !!!!!!!!!!!!!

Foxwood

Sponge Bob wrote:

so what They are now carrying amost €1000 of debt for every man woman and child in this country .

Does anyone know how much eircoms customers have had to pay out over the last 7 or 8 years to fund all the profit taking by "investors"?

Funny how you never hear Bertie telling the Dail that TonyO "stole" billions from Irish phone users.

damien

Lookey what I found:

OUTLOOK: Sacked Danon may return to Britain JEREMY WARNER

11 October 2005 The Independent (c) 2005 Independent Newspapers (UK) Limited .

Pierre Danon, sacked last week as chief operating officer of France's Cap Gemini after secretly interviewing for the top job at Accor, is one of the most unashamedly ambitious executives I've ever come across, and this from a field not known for hiding its light beneath a bushel. Now he's heading back to these shores, where there are a number of 'opportunities' he hopes to pursue. A word of warning. M. Danon is not a team player, or not unless he's the captain, a position he's yet to attain.

While at British Telecom he behaved for all the world as if he was the chief executive, holding his own press briefings and speaking with assumed authority on the future of his industry and the company.

In fact he was just the head of retail, where he came as close to declaring UDI from the company he worked for without suffering the usual consequences as I've ever seen in a humble line manager. The real chief executive, Ben Verwaayen, called the public dispute M. Danon had with wholesale about whether he should be allowed to invest in his own DSL equipment a 'debate'. In truth it was a scarcely veiled pitch for independence, or perhaps for Mr Verwaayen's job itself.

Make me chief executive or I will go, he seemed to be saying, so he went, though not to the top slot he craved. His subsequent falling out with his boss at Cap Gemini was ironically an inevitability much predicted by those who knew him in Britain but a total surprise to his native France.

M. Danon is such a determined type he'll no doubt eventually get the position he desires, though probably not in France, where Cap Gemini's statement that 'the necessary conditions to maintain his leadership position could no longer be met' must have trashed his reputation. M. Danon's disloyalty might not count against him in the cut and thrust of our more raw, Anglo- Saxon ways. Whether he's any good or not is anyone's guess.

Sponge Bob

Danon is the O Reilly replacement , I am not sure what will happen to Phil thereafter. However Phil ain't poor. Danons number 2 will be Cuddly Con Scanlon , the postmodern face of Irish Trade Unionism himself.

the personable, charming and affable McRedmond is in line to become CEO if Phil exits .

damien

I'm hearing 2 senior are going to go and one not as senior is going too.

I was just chatting to Pierre (kinda) and he's asked IrelandOffline to meet him. There's a first!

watty

B&B will find he is no French poodle anyways!

damien

watty wrote:

B&B will find he is no French poodle anyways!

No, that would be our telecoms watchdog.

Sponge Bob

damien.m wrote:

No, that would be our telecoms watchdog.

Pierre will imperiously summon that mangy cur down to Stephens Green whenever he feels like . It will go !

You may be certain he will never cross the Liffey except to get to the Airport .

Altreab

Sponge Bob wrote:

so what They are now carrying amost €1000 of debt for every man woman and child in this country .

http://www.rte.ie/business/2006/0523/eircom.html



Biddy has leveraged her fat arse a tad as well.



Thats a fairly big bite of the turkey. The ESOT would have had to borrow some €250m-€300m to fund that increase in its stake. The reason why the ESOT felt it had to do that has a lot to do with Biddys pension !!!!!!!!!!!!!

Biddys Pension and Biddys Job!! ....... remember that many are working there now and their pay would be in line with civil service pay ....thats going back to the days when ESOT was setup in order to "convince" the workers of P&T as it was then, to going from "windup" operator phones to direct dial was a good idea.
They effectively got "jobs for life" at civil service rates. So remember that when you get crap service when you ring them!! they are on around €38K a years plus benifits compared to around €20K-€22K a year for those in a normal call centre.
With 35% of the shareholding they can stop any extra ordinary events happening..... such as major job layoff or out sourcing of work. From memory they have around 50% more employees than similar companies over seas.
This is only likely to change when more of the ESOT share holders are non workers than workers (and cost reductions will be needed to continue thr growth of "shareholder value".
Any one know the present ratio of same?

Right ...Crawler ...where ru? How much did you say to get a Metro link to the house????

Altreab

Foxwood wrote:

Does anyone know how much eircoms customers have had to pay out over the last 7 or 8 years to fund all the profit taking by "investors"?

Funny how you never hear Bertie telling the Dail that TonyO "stole" billions from Irish phone users.

Because if he said that it would imply that ALL the shareholders were thiefs and we cant say such a thing about the shareholders (many who are union members AKA Esot) ....strange we never hear ICTU complaining about "Ripoff Ireland" and phone bills ...i wonder why?? *tongue firmly in cheek*

Altreab

Sponge Bob wrote:

Pierre will imperiously summon that mangy cur down to Stephens Green whenever he feels like . It will go !

You may be certain he will never cross the Liffey except to get to the Airport .

mmmmmm Sharing the mange might be the only way that Eircom will care about what Comreg thinks/says!!!

eircomtribunal

From what's probably Australian Fox news:

Eircom will be saddled with E3.8 billion ($5.8 billion) of debt after the acquisition. The company will cease paying dividends after the change in ownership and interest payments will be tax deductible. Its adjusted profit before interest, taxation and depreciation last year was E601 million.

BCM will get 55 per cent of the equity from the deal, with eircom's Employee Share Ownership Trust owning 35 per cent of the company and two other Babcock funds rounding out the remaining 10 per cent. The deal will be 20 per cent equity funded.

"The important thing to note is that, if you took the sum of their current debt service, tax and dividend payments, that number is significantly lower than the same number if and when we take over the business," Mr Topfer said. "So we will have available cash for reinvestment in the business."

Pierre Danon, chairman designate of eircom after the ownership change, said eircom was an opportunity for a "growth-oriented transformation".
He said it had just bought a mobile company called Meteor, which should generate revenue and earnings growth.

"Eircom is well positioned in mobile," Mr Danon said.

As Ireland was late in adopting broadband internet, and because of little competition, there was room for business growth, he said.

Mr Topfer also pointed to Ireland's strong economic growth and young population as pluses for the business.

He has suggested that it might make sense to split the network from the retail business, creating a monopoly infrastructure asset easily valued by Australian investors.

He said yesterday that BCM planned to run a vertically integrated company, but added that if there were a push for separation, "we are open to those sorts of discussions with government".

My two questions about the bolded sentences:
First part: Wasn't the high dividend the thing which made investors buy and keep onto Eircom shares? No more dividends for investors then?
Second part: What does that mean? Makes no sense to me how it is written here. How can they say to have more cash for reinvestment if the current figure of outpayments will be significantly lower than after the take-over?

P.

eircomtribunal

From The Sidney Morning Herald

All up, the partners plan to nearly double Eircom's debt levels to €3.8 billion, giving the company a gearing of about 80 per cent.

On the equity side, B&B Capital will own 65 per cent of the venture.

Mr Topfer said the proposed debt servicing levels will actually be less than Eircom's current spending on dividends, tax and debt interest.

"We will have available cash from the business … that is in excess of the current outflow from those (payments)," he said.

So despite doubling the dept level of Eircom the future outpayments are supposed to be less than the current outpayments.
Cannot be a lot that could be gained and used for the necessary investment in the network.
P.

damien

Interview on TodayFM this evening (don't know time, maybe the 1630 slot) with Pierre from eircom and myself.

paulm17781

Altreab wrote:

So remember that when you get crap service when you ring them!! they are on around €38K a years plus benifits compared to around €20K-€22K a year for those in a normal call centre.

The ones I know were getting 16k and more if they met certain targets.

zuma

Good to know...cant wait to listen!

Thank goodness for Matt Cooper keping the Broadband disgrace in the headlines!!!

Sponge Bob

Altreab wrote:

Biddys Pension and Biddys Job!! ....... remember that many are working there now

Ahhhh no.

The ESOT represents 14000 current and former eircom staff who were working in Eircom circa late 1998 . Many now work in Vodafone for example .

The companies covered by the ESOP are eircom
and the following wholly owned Irish subsidiaries of
the Company: Eircell Ltd, Eirpage Ltd, Eirtrade Services Ltd, Indigo Ltd, ITI plc, TII Ltd, and eircom Phonewatch Ltd.

Through various Biddy culls and outsourcing eircom now has about 7000 full time staff of whom some 5-6000 are members of the ESOT probably about 6000 . Biddy culls especially between 2001-2004 meant that they were each paid around €150k to €200k to please go away. The number of traditional eircom Biddies answering 1901 has dropped dramatically in the past 3 years although there remains a bastion of Biddydom in the fault reporting section on 1901 .

Therefore MORE THAN HALF the members of the ESOT nowadays are EX EIRCOM EMPLOYEES and are only interested in lump sum disbursements from the ESOT and also in the pension. Because the ESOT represents Ex Employees not current employees you may have noted that the CWU which ran the ESOT for a long time until Con got too busy with his ESOT to bother with the CWU any more.... actually had to organise their own meeting with B&B last month because the ESOT is not there to represent their interests any more. The balance between current and ex employees changed around late mid to late 2004 .

The ESOT has furthermore managed (so far) to keep a lid on the bunch of Ambulance Chasers that Biddy has lined up to do some freelance asset stripping for her in Eircom over the next few years. Someone really must tell Pierre about the compo claims for deafness that are in the pipeline but have been kept off the balance sheet and risk assessments because the claims have not yet been 'formally' registered.

the Guru

Pierre talks a good story, it will be interesting to see if he backs this up, to open up the network , to competition

mike65

Bah! Missed the interview except the last two seconds (nothing important in that bit).

Mike.

bealtine

mike65 wrote:

Bah! Missed the interview
Mike.

Did anybody grab it or is it available online? For some reason I can't connect to the todayfm stream...

zuma

Wait until 19:30 and Today FM will have it online(at VERY low bitrate) on Matt Coopers page.

Altreab

Sponge Bob wrote:

Ahhhh no.

The ESOT represents 14000 current and former eircom staff who were working in Eircom circa late 1998 . Many now work in Vodafone for example .



Through various Biddy culls and outsourcing eircom now has about 7000 full time staff of whom some 5-6000 are members of the ESOT probably about 6000 . Biddy culls especially between 2001-2004 meant that they were each paid around €150k to €200k to please go away. The number of traditional eircom Biddies answering 1901 has dropped dramatically in the past 3 years although there remains a bastion of Biddydom in the fault reporting section on 1901 .

Therefore MORE THAN HALF the members of the ESOT nowadays are EX EIRCOM EMPLOYEES and are only interested in lump sum disbursements from the ESOT and also in the pension. Because the ESOT represents Ex Employees not current employees you may have noted that the CWU which ran the ESOT for a long time until Con got too busy with his ESOT to bother with the CWU any more.... actually had to organise their own meeting with B&B last month because the ESOT is not there to represent their interests any more. The balance between current and ex employees changed around late mid to late 2004 .

The ESOT has furthermore managed (so far) to keep a lid on the bunch of Ambulance Chasers that Biddy has lined up to do some freelance asset stripping for her in Eircom over the next few years. Someone really must tell Pierre about the compo claims for deafness that are in the pipeline but have been kept off the balance sheet and risk assessments because the claims have not yet been 'formally' registered.

How many full time staff would be working in a similar operation elsewhere can anyone tell me?
Interesting to see the CWU spokesman saying this evening that B&B had agreeded to all their concerns and put it on paper. That they were satisfied with the agreement ...not a single word about the effects on the consumers. ESOT now 35% now so will be interested to see how the battle to cut the cost base and improved profitability and the CWU battle to increase pay and keep jobs pans out . Especially as 5000-6000 workers will be on BOTH sides of the table.

The new guy was on tv talking about prices .....said some will rise for inflation and wages ....pointing out that wages in Ireland are rising more inflation ....but other pricing will fall because of competition and new technology . In other words ......Rental will rise as much as they can get away with ......cost of calls will drop to compete. Everything stays the same!! :mad:

Blaster99

Telecom Eireann was to my knowledge the most inefficient telco in the EU, as measured by lines per employee. As SB points out, they got rid of a lot of people when they became eircom. Curiously their customer service improved dramatically around that time. You could nearly mistake them for a real company whereas before they were just a certified basket case. I don't know what the story is now but I can't imagine they have too much fat as they're a commercial outfit.

Sponge Bob

Blaster99 wrote:

Telecom Eireann was to my knowledge the most inefficient telco in the EU, as measured by lines per employee. As SB points out, they got rid of a lot of people when they became eircom.

Mainly between 2001 and 2004 .

Curiously their customer service improved dramatically around that time. You could nearly mistake them for a real company whereas before they were just a certified basket case.

Around 2004 I noticed that rude ignorant Biddies were in rapid decline as a species. The joys of getting randomly routed to Biddy in Mullingar then Biddy in Cork then Biddy in Castlebar as the 1901 system hunted them down in down in their lairs was no more. 1901 has been pulled out of these places, replaced by that gob****e sports commentator ( who hangs up on you all the time, for example if you say "can't" to him in a Mayo accent ) and if a human can be found at all they are in the one office now bar the line faults ones where Biddy still larges it countrywide in her shrinking habitat .

Biddy has been replaced by clueless but civil eurofluff in Citwest. Small loss

Pierre , when interviewed, 'would love to get together with Damien' he said but he made no further promises except that investment would be a little bit higher. Probably €5m higher.

I guarantee that payments into Biddys pension fund will increase by a greater amount than investment in the Network !

the Guru

Firstly its ESOP http://www.esop.eircom.ie/ Employees Share Ownership Plan

And Secondly a very good friend of mine is a team leader in the 1901 call centre, there's one of his team that has been there for years, he's on one of the really old contracts.

They have to send him a letter in writing to his home address advising that they want to meet with him for team meetings etc....

what a load of boll-ox, the guy is untouchable because of his contract , he is been paid a **** load of money, and he plays up to the letter's. Their have been a few occasions that he has advised the time and date on the letter is not good for him.

mike65

matt cooper interviews right click and save or stream with left click.

Mike.

pete

Altreab wrote:

Interesting to see the CWU spokesman saying this evening that B&B had agreeded to all their concerns and put it on paper. That they were satisfied with the agreement ...not a single word about the effects on the consumers.

Since when is that the union's job? They're there to look after their member's interests. End of.

You should probably direct your 'effects on the consumer' queries to the jokers that sold off the family silver to those who'd already paid for it in the first place.

zuma

the Guru wrote:

Firstly its ESOP http://www.esop.eircom.ie/ Employees Share Ownership Plan

And Secondly a very good friend of mine is a team leader in the 1901 call centre, there's one of his team that has been there for years, he's on one of the really old contracts.

They have to send him a letter in writing to his home address advising that they want to meet with him for team meetings etc....

what a load of boll-ox, the guy is untouchable because of his contract , he is been paid a **** load of money, and he plays up to the letter's. Their have been a few occasions that he has advised the time and date on the letter is not good for him.

Nice to know another reason why we have to pay Europes highest, by far, line rental!

Utter ridiculous!

eircomtribunal

According to the interview – well done Damien and well done Matt Cooper – Pierre Danon really thinks that we have Europe's cheapest dial-up Internet access. Wonder what else the guys of Eircom told the Babcock crew?

Earlier Babcock had told the press (see my quote somewhere above) that the level of outpayments would decrease despite the higher borrowings, Pierre now says the level will not get higher than before...

P.

kaizersoze

Well done Damien. Be careful he doesn't offer you a job if ye ever get to meet.:p

eircomtribunal wrote:

Earlier Babcock had told the press (see my quote somewhere above) that the level of outpayments would decrease despite the higher borrowings, Pierre now says the level will not get higher than before...

He also started by saying they would be investing "slightly more" than the current level. By the end of the interview it was "significantly more".:rolleyes:

damien

kaizersoze wrote:

Well done Damien. Be careful he doesn't offer you a job if ye ever get to meet.:p

He kept to his word and his "people" rang my "people" (me) to request an audience. Stay tuned.

kaizersoze

damien.m wrote:

He kept to his word and his "people" rang my "people" (me) to request an audience. Stay tuned.

Don't be swayed by the swanky office and the secretary in the french maids outfit, stick to your guns.:p

dahamsta

kaizersoze wrote:

Don't be swayed by the [...] secretary in the french maids outfit, stick to your guns.

<adam's brain twists into möbius strip>

Altreab

pete wrote:

Since when is that the union's job? They're there to look after their member's interests. End of.

You should probably direct your 'effects on the consumer' queries to the jokers that sold off the family silver to those who'd already paid for it in the first place.

Thats my point exactly....Maintain the status quo .... Zero incentive to change and adapt to new times and ways of doing things ...... The customer comes a VERY long way down the line. Expect the downward spiral of investment in the network and service quality to continue.

Sponge Bob

When in charge of BT Retail Pierre bid for the contract , and won it, and executed it, to supply 100% BB to NI . He is justifiably proud of that achievement.

I see no reason why his track record in NI is in any way incompatible with IoffLs prime directive.

A civilised Dialogue on how to achieve this and as to when it can be achieved is a good thing at this time, especially if Pierre is already convinced of the desirability in principle of universal BB availability.

The eircom 3.5Ghz licence is also heading for an imminent important milestone of the 5 Year Coverage target = 70 % of the population . Thats in June 2006 IIRC .

Therefore by next month 70% of the population should be able to get a wireless solution from eircom where DSL is only available to 60% or so .

Many of the 3.5Ghz bases do not overlap DSL coverage areas .

Pierre seemed fairly confident on 3g as well despite the fact that Eircom do not have a 3G licence

Mr_Man

Given that Comreg have shown very little or no desire to enforce the spectrum coverage requirements I don't think Eircom will be losing too much sleep over the June deadline.

Further given the way that Comreg jumped when Eircom's lawyers sent the letter questioning the award of the 3G license to Smart perhaps Pierre is right to be confident about having an offering.

Again I suggest that Comreg is part of the problem, not part of the solution and the sooner they are dispatched to quango heaven the better for all involved.

M.

eircomtribunal

Slightly different sounds at the other side of the world:

Eircom's boss-to-be considers break-up

By Dominic White in London
May 25, 2006

EIRCOM'S executive chairman to be, Pierre Danon, is to enter talks with the Irish Government about breaking up the country's former phone monopoly once his backers complete a €2.42 billion ($4.12 billion) takeover of the company.

Mr Danon, former chief executive of British Telecom's consumer division, is to become executive chairman of Eircom after it agreed to be taken over by Babcock & Brown and its Employee Share Ownership Trust for €2.20 a share in cash.

The deal will catapult the Frenchman back into the spotlight and prompt Eircom to consider a structural separation of the kind BT baulked at when Mr Danon was on the board.

"I'm not ashamed about it," Mr Danon said after Sir Anthony O'Reilly, Eircom's current chairman, recommended the takeover to shareholders.

Despite regulatory pressure, none of Europe's former telecom monopolies has separated its retailand wholesale divisions.

However, Mr Danon said such a split made more sense in Ireland because it was a medium-sized country with about 4 million inhabitants.

"A lot of governments are now thinking about it and minds are maturing around the idea," he said. "We will talk to the Government and the regulator to gauge if there is an appetite. We want to see whether value can be created."

Analysts wonder how much more value can be generated from Eircom because it has changed hands four times in six years. But Mr Danon said B&B was a long-term investor and any exit would be more than five years away.

"There are some possible efficiencies left in the business such as transforming the IT systems, which are not in very good shape," he said.

"The company has been managed for a quick exit and a little bit starved of innovation so we also have an opportunity to invest in broadband, which is less developed in Ireland."

P.

zuma

So any ideas of how much they might ask for the network?

I can see them asking for far too much and years of discussions before anything happens!

paulm17781

zuma wrote:

So any ideas of how much they might ask for the network?

I thought they wanted to keep the network and ditch the retail arm?

Mr_Man

I don't think the new owners are planning to sell off the network, it is the cash cow in all of the crap that is Eircom. What they are doing is trying to sound out the Government's reaction to splitting the two pieces - specifically can they get any guarantees about the regulatory framework they would face.

Basically they want to know if the poodle that is Comreg can stop its yapping and go away so they can get on with stripping as much value as possible out of the network before flogging it off again.

M.

zuma

This crap makes me absolutely sick!

Its like beating a dead dog....what else can they get out of eircom?

eircomtribunal

"The Irish Line Dance" Long article in the Sunday Times going over the story again in detail

ComReg has so far shown itself to be something of a eunuch in its attempts

There's also an article by Kathleen Barrington in the sbpost: "Customers fear increase in line-rental charges "
P.