Irish fixed, broadband and mobile operator Eircom has put itself up for sale as its seeks to restructure its EUR3.75 billion (USD4.93 billion) of debt and avoid a default. In a statement released yesterday, ERC Ireland Holdings Limited confirmed that the board of directors have authorised the initiation of a process to assess the interest of third-party strategic and financial investors in a sale of Eircom. It went on to say that the process will be conducted ‘as part of the wider balance sheet remediation process currently underway’. The telco has appointed Morgan Stanley & Co International to act as advisor in the sales process, and says that it has set a deadline of mid-March 2012 for the receipt of non-binding expressions of interest. In the meantime Eircom will continue to consider and discuss separate proposals received from the Coordinating Committee of the First Lien Senior Lenders and a grouping of the Second Lien Senior Lenders, and as such ‘will consider any expressions of interest received under the sales process as additional options for the balance sheet remediation process’. In December last year the group’s majority shareholder Singapore Technologies Telemedia (STT) withdrew from Eircom’s board after lenders rejected its debt restructuring plans.
Separately, Eircom says that its lenders have agreed to extend the covenant waiver for the breach of the senior debt/EBITDA covenant under the Senior Facilities Agreement (SFA) as at 30 June 2011, 30 September 2011 and 31 December 2011 until 31 March 2012. This follows the request for a further waiver extension issued by Eircom to the SFA lenders issued 19 January 2012.