Eircom puts an end to sales process

EIRCOM HAS put an end to the sales process it began in January by rejecting the expressions of interest submitted for the company ahead of the deadline of March 12th, the telco’s parent company ERC Ireland Holdings Ltd said yesterday.

Eircom said the indicative bids received had been “assessed and rejected” by the board of directors.

It added that it was now supportive “in principle” of a revised proposal submitted by a committee of the company’s first-lien lenders.

The revised proposal was presented by the co-ordinating committee of the First Lien Senior Lenders (FLCC) to the company’s senior lender syndicate yesterday.

“The company will continue to work with the FLCC to finalise this revised proposal as the next step in the balance sheet remediation process to provide a sustainable capital structure for the group,” it said in a statement.

Eircom’s first-lien lenders proposed to write off 15 per cent of their loans, twice as much as previously planned, in exchange for full control of the company, two people with knowledge of the matter said.

They said the lenders, led by two Blackstone Group units, were due to meet in London yesterday.

The first-lien blueprint envisages second-lien lenders recovering €35 million, or 10 per cent, of their loans, with more junior creditors losing virtually all their investment, according to the two people who have declined to be identified because the talks are private.

Eircom is seeking to restructure its €3.75 billion debt, which the company accumulated through five ownership changes over 13 years.

The company had hired Morgan Stanley to assess non-binding offers by mid-March.

(Additional reporting: Bloomberg)