Eircom examiner declines indicative offer, telco confirms EUR2.9bn loss

1 May 2012

Eircom examiner Michael McAteer has rejected a ‘conditional non-binding offer’ for the troubled telecoms group from an unnamed party. The carrier issued a statement yesterday confirming the approach but adding that the examiner decided not to proceed, given ‘the level of the offer and its conditionality’. It is understood that Eircom’s first lien co-ordinating committee of lenders unanimously supported the decision. The Irish carrier also revealed that it has filed its statutory accounts for its fiscal year ended 30 June 2011, showing the group made a loss of EUR2.856 billion (USD3.780 billion). The report covers the three companies currently protected by the court under examinership. These are Eircom Limited (the main trading company), Meteor Mobile Communications Limited and Irish Telecommunications Limited. Revenue for Eircom Limited fell to EUR1.689 billion for the year to 30 June 2011, down 8% on the previous year. EBITDA closed at EUR647 million, down 4% on the previous year. Eircom Limited also finished the financial year with EUR459 million in cash. Total access channels excluding DSL stood at 1.738 million for the full year, while Eircom reported having a total of 671,000 retail and wholesale DSL accesses at the same date. Finally, total mobile customers stood at 1.031 million.

Further, Eircom is also implementing measures to streamline and simplify its corporate structure. As part of which, one of its group companies – ERC Luxembourg Limited – last week submitted a voluntary declaration of bankruptcy with the Luxembourg District Court. Further, two more group companies – Eircom Group Limited and Valentia Telecommunications – have each proposed special resolutions of their shareholders to wind up the companies voluntarily, while ERC Ireland Preferred Equity, ERC Ireland Finance, and their subsidiary ERC Ireland Holdings presented a petition for liquidation to the grand court of the Cayman Islands on 27 April.

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