Shares in alternative telecoms firms have plunged again today as funding and outlook fears gripped the market and investors dumped former leading light Energis.
Energis's stock was beaten down 30 per cent today to a low of 2p, extending yesterday's 70 per cent dive, in heavy volume with 200 million shares changing hands. The company is under £1 billion sterling of debt.
Rivals COLT Telecom and Thus also skidded to all-time lows, caught up in the Energis induced fever to abandon the over-supplied and debt-laden sector.
Yesterday Energis said it would retreat from continental Europe and admitted that it had breached the terms of its recently refinanced loan.
ABN Amro analysts said the company may be unable to meet interest payments on its bonds in March and was now at the mercy of its banks making a debt-for-equity swap more likely and the shares worthless.
Bonds issued by Energis held steady early today after falling to 15 per cent of their face value today.
Energis's market value is now a merely £68 million compared with a peak of £14 billion in March 2000. The stock has lost 99 per cent of its value over the past year and faces relegation from the FTSE 250 Mid-cap index when the index provider FTSE reshuffles on March 5th.
Shares in COLT sank to an all-time low of 37 pence, extending yesterday's 18 per cent slide. Some 61 per cent has been wiped off its share value over the past year.
Another casualty was alternative telecoms operator Thus, whose shares sagged 17 per cent to 19p, a record low as it was struck by the Energis contagion.
Alternative telecoms, providing services and wholesale communications access mostly to companies, have suffered as the Internet bubble burst and prices in the resulting over-suppled telecoms capacity market slumped.