[Irish Times] Eircom seeks advice to break from private equity ownership.

trekkypj

An interesting development, wouldn't you say?

http://www.irishtimes.com/newspaper/finance/2009/0425/1224245377663.html

Tom Young

Nah not all that interesting, Magee is correct - Something's got to be done.

My own view is ESOT ownership might be one option, but it's not the best.

Tom

crawler

Agreed.

In fact, there is no single entity that is best - the best option is probably a mix of Government (Minor part, not running it), ESOT, Management & Corporate finance.

Regardless of who owns it - some very tough decisions need to be made.

It's all very fixable though.

croo

Mr Magee said Eircom had a pivotal role to play in shaping Ireland’s smart economy.

Well I'm glad to see he used the correct tense there ... past tense... Eircom HAD a role and it choose to screw the country for every penny it could. This company should not have any strategic role to play going forward though. Let it go bankrupt and the sooner the better. Or is this the first step, next we can blame all those foreigners (dem bloody ozzies), and finally are we going to be told it's "systemic"? ... just like Anglo!?

SkepticOne

I think the problem with Eircom is that they have had it pretty much their own way with the regulator and the government all these years and this has made them unable to operate in a competitive world.

They have been allowed to charge possibly the worlds highest line rental by the regulator causing large numbers of people to stay away from landlines altogether.

When ADSL eventually came out years after other countries were enjoying theirs, again, Eircom were allowed to charge what was possibly the highest charges in the world for a very low-end service.

For years, they were also allowed to charge high prices and impose ludicrous conditions on competitors hoping to make use of LLU.

They only made minimal use of their ample wireless spectrum for broadband.

They opposed efforts to improve minimum functional internet access for citizens.

(Note that most of these problems were present before any ownership by private equity. Some date back to when the company was State owned.)

Now the same management that presided over the decline of their own company are whinging about the fact that only vulture capitalists are interested in owning Eircom. I've no sympathy for them. Let them go bust.

After they go bust, the State should ensure that no one company has the sort of dominance that Eircom currently has. That has been the root of the problem all along.

Sponge Bob

No matter who 'owns' eircom there is no way they can refinance the €4bn of debt in 4 years time without crashing it.

The pension liabilities may get it first !

bk

The Irish Government should leave it go bust. Why invest or buy a company with 4 billion in debt, when for 2 billion you could probably run fibre to every home in Ireland and for 500 million every home in the 5 cities.

They should leave it go bankrupt and then pick up any valuable pieces (fibre network, etc.) for a song.

Eircom has little else of value to offer the Irish people.