eircom sells off more bits , their towers

Sponge Bob

todays irish times has an article on the selloff of eircoms towers for €150m , there are 300 of them but they only pull in an 'income'of €10m a year (€30k each) which strikes me as low .

anyway lets see if they can reduce their spiralling debt for the first time, it has gone from €4bn to €4.2bn in the last year, surely an unsustainable situation.

lucernarian

That is quite low allright. But if the income eircom earned on them is that low, would the selling price be that high?

oscarBravo

I would guess the income is low because they make it somewhat difficult for anyone else to access them. Facilitating competition has never been Eircom's strong point.

Case in point: the Eircom tower in Castlebar, versus the much smaller ESB tower. The ESB tower is wedged to capacity, while the (on the face of it much more useful) Eircom tower is relatively sparsely populated.

jesus_thats_gre

When those towers were first erected, I am guessing that quite a few telcos were paying Eircom big bucks for the use of them and other Eircom facilities. I very much doubt that is the case anymore so it probably makes sense to sell them off.

Sponge Bob

jesus_thats_gre wrote:

When those towers were first erected

There WERE no other telcos

They provided long range (30km ish per hop ) microwave links which have been replaced by fibre in the past 15 years .

They bring in surprisingly little income overall, were eircom not desperate for cash because of B&Bs recent 'problems' with the Australian Capital Markets they could have spun out a 'towerco' to do wholesale tower space rental in a transparent manner.

While the thing is being sold at 15x profit and with lots of paint jobs needed it should double its income very quickly once its not in eircoms hands. In Galway the eircom tower is vastly preferable to the overloaded and stumpy ESB tower, if accessible at a reasonable cost with co-lo.

zugvogel

The government has also done a deal whereby any mobile teleco can install equipment on nearly all buildings controlled by the OPW - which equates to nearly all public buildings in the state e.g. government departments, state agency buildings, garda stations and so on. In the building I work in for example Three have two antenna on it.

watty

€150M is a bit expensive. But it may be an auction, where they end up getting much less than that.