Eircom seeks potential buyers

Eircom has put itself up for sale as it seeks to restructure €3.75bn of borrowings and avoid a default.

The former state-owned group said yesterday it had hired Morgan Stanley to advise it on a sale, and prospective buyers have until mid-March to table their interest.

The company said it was continuing to consider proposals received from its first-lien and second-lien senior lenders, and added that it will also “consider any expressions of interest received under the sales process as additional options for the balance sheet remediation process”.

The sales process is running in parallel with talks with senior lenders about how to restructure its debt, including a syndicate of first-lien senior lenders owed €2.4bn and a group of second-lien senior lenders owed in the region of €350m.

In December of last year, representatives from the company’s owner, Singapore Technologies Telemedia (STT) — withdrew from the company’s board after lenders rejected its debt restructuring plans.

Temasek unit STT bought 65% of Eircom in 2009 for €140m in cash and shares.

An employee share trust owns the other 35%.

Separately yesterday, Eircom said its lenders had agreed to waive its debt covenants until the end of March.

It is speculated that the company may file for examinership — a rescue process designed to help businesses recover from insolvency, if the company fails to attract a buyer.