Eircom agrees £1bn takeover deal

Eircom has agreed to be taken over by Valentia Telecommunications in a £1bn deal.

Valentia, a consortium led by Anthony O'Reilly, chairman of Independent News & Media and former Heinz president, first approached the group in April.

Eircom's independent directors are recommending that shareholders accept the offer.

Valentia, whose members include financier George Soros and investment bank Goldman Sachs, has set out two proposals on which shareholders must vote.

The first it that it pays up to 1.32 euros (0.79p) per share over a period of time.

The second is a cash offer of 1.27 euros (0.76p) per share, which would give the company a total value of 2.8bn euros (£1.68bn).

The Valentia bid was one of a variety of offers that Eircom has received since selling its mobile phone business to Vodafone earlier this year.

The group said it had decided to consider such offers following "increasing competition and falling prices in its core voice telephony businesses".

Pending shareholder approval, the deal is expected to complete by the end of October.