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[Indo]Eircom court battle hit Smart shares

  • 09-08-2005 11:43am
    #1
    viking
    Registered Users, Registered Users 2 Posts: 1,509 ✭✭✭


    By Tom McEnaney
    The sharp fall in Smart Telecom's share price over the past two weeks is directly attributable to Eircom's recent High Court win against Comreg, according to Jack Gorman, telecoms analyst with Davy Stockbrokers.

    According to Mr Gorman, although the recent failure to acquire mobile company Meteor was not good news for Smart Telecom, it had been anticipated, while Eircom's High Court win was a significant and unanticipated setback.

    Shares in Smart Telecom, which were trading at 37p last month, had fallen to 20p by the close of business yesterday, knocking €34m off the value of the company.

    Less than two weeks ago, Eircom won a High Court case against Comreg which effectively stymies the regulator's efforts to force Eircom to open the 'last mile' of its network to competitors.

    Gorman said: "Basically, this means it will be the back end of this year at least before Smart is able to transfer its broadband customers easily.

    "This is a major issue for Smart which must get customers, not just signed up, but connected.

    "This is why we have seen a sharp drop in their share price over a time when the sector generally has been pretty flat."
    Smart will need deep pockets in order to fund themselves if they cannot get customers connected, otherwise they will be ground down by eircom's "playing [of] the regulatory game".

    I've always felt that eircom would win their recent court case based on the arguments put forward (ie. Comreg could not issue a second directive on the same matter while the first one was being appealed), I'm just surprised Davy Stockbrokers have said it was unanticipated.


Comments

  • #2
    paulm17781
    Closed Accounts Posts: 4,858 ✭✭✭paulm17781


    Did any papers other than the independant carry this story? :rolleyes:


  • #3
    viking
    Registered Users, Registered Users 2 Posts: 1,509 ✭✭✭viking


    paulm17781 wrote:
    Did any papers other than the independant carry this story? :rolleyes:
    You're such a cynic paulm17781, why on earth would the Indo be biased in any way.... :eek:


  • #4
    zuma
    Closed Accounts Posts: 1,685 ✭✭✭zuma


    viking wrote:
    You're such a cynic paulm17781, why on earth would the Indo be biased in any way.... :eek:

    Yeah...(Sir. An)Tony O'Reily wouldnt have anything against Smart now would he...haha???


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