By Eamon Quinn
Eir has told its investors its next big decision on its future plans won’t be revealed until later this spring when the deal involving its new French owners is expected to be completed.
It comes as another business group, Isme characterised the telecom firm’s plan announced this week to pull out of the Government’s National Broadband Plan as disastrous and which will likely delay the introduction to 2023. It said it has serious reservations about the contract process run by the Department of Communications after what Isme said was Eir securing “low hanging fruit” in its existing installation of broadband.
Outgoing Eir chief Richard Moat in its latest quarterly report blamed the complexity of the National Broadband Plan contract and identified pricing issues “outside of the National Broadband Plan process” for it quitting the tender.
Underlying earnings of €125m in the three months to end December were up 4% from a year earlier on reduced costs, even as revenues fell 2% to €322m, leaving it on target to hit full-year earnings growth targets, it said. Storm- related costs came to €3m in the quarter. Mr Moat had no other news on the company’s strategy. Eir has changed hands more times than any other European national telecom. It is being bought by French entrepreneur Xavier Niel via NJJ and Iliad.
He will buy a 64.5% stake in Eir for an estimated €1bn, while two US hedge funds remain as minority shareholders. The firm has net debts of €2.16bn. Fitch Ratings analyst Damien Chew said Eir’s latest earnings were “broadly in line with what we expected”. He said the effects of the change of ownership won’t be known until the deal is completed, probably in April.