Eir is seeking to cut costs with up to 240 job cuts as it gears up for a possible stock market tilt as early as next year. The telco market leader, which has cut well over 2,000 jobs in recent years, this week launched a fresh voluntary redundancy scheme.
The move has come as a major surprise, given that management was guiding in recent months that Eir’s headcount reductions were finished for the foreseeable future. The fresh round of cost cutting has led to inevitable speculation that Eir is readying its finances for the mooted flotation , indicating it might be at an advanced stage of planning.
The voluntary scheme is aimed at about 800 of its 3,300 employees. The divisions targeted are right across the group, primarily in office roles. The technical staff engaged in its massive fibre investment programme, for example, are not affected.
It is understood that staff who take up the voluntary scheme will get about five weeks’ pay per year of service. Given the declining unemployment and chances of finding a new job relatively easily, Eir is confident it will get the numbers.
As a result of the extremely competitive telecoms market in Ireland and the evolving technologies used to deliver our products, services and content, the company faces the necessity for on-going transformation and improved operational efficiency. This includes the need to reduce our pay costs," it said last night
“The company aims to reduce the number of full time employees by 200-240. All staff departures will be on an entirely voluntary basis with the majority arising at our Dublin offices and potentially a small number at our regional locations.”
The company says it is engaging in consultation with unions and the Department of Communications.
“The proposed restructuring will not impact on the company’s ability to deliver on recent commitments in respect to the rollout of our rural Fibre to the Home (FTTH) programme and the recent contract signed with the government,” it said.
Richard Moat, chief executive of the group, recently told The Irish Times that the company could return to the stock market as early as next year, having abandoned a flotation in September 2014.
“We’re talking 2019, plus or minus a year. It’s a three-year window through 2020,” said Mr Moat in April.
Any flotation must raise money to cut its €2.13 billion debt pile, before giving its hedge fund shareholders and other investors a chance to make a return, Mr Moat has said.
Underlying revenue rose 1 per cent to €325 million year on year in the three months to the end of March, excluding the effects of currency movements. This was the eighth straight quarter of growth for Eir.