independent

Thursday 17 April 2014

Eircom appoints Rothschild to sell Phonewatch

EIRCOM, the State's biggest telcoms operator, has appointed Rothschild, the prestigious global investment bank, to sell Phonewatch, its popular security alarm monitoring system.

The move to sell Eircom Phonewatch is part of a strategy by its new management team led by Herb Hribar to focus the telecoms company, which had debts of €2.3bn, on its core business lines.

Eircom does not break out the profitability of its Phonewatch division, making it hard to value from the outside but it is certainly worth in the tens of the millions.

The fully owned subsidiary of Eircom was founded in 1991 and has a 100,000-strong customer base.

It is profitable and highly cash generative, making it an attractive proposition to private equity purchasers. Eircom has 150 staff based primarily in Sandyford, south Dublin.

Eircom is believed to be reviewing the future of other non-core assets but no other decision is understood to have been made. A spokesman for Eircom declined to comment.

Eircom was the subject to the largest examinership ever in Ireland last year when its senior lenders took control of the business and slashed Eircom's debts from about €4bn to €2.3bn.

It plans to cut staff numbers by 2,000 over the next 18 months and focus on growing revenues from areas like quad-play bundled offerings combining television, broadband, 4G mobile and fixed line services.

Eircom has in the past been criticised by its rivals for not investing enough in Ireland. On December 20 last, the Commission for Communications Regulation (ComReg) told Eircom to comply with agreed service levels to other telecoms operators or suffer consequences.

Late last year former ESB chief executive Padraig McManus was appointed non-executive chairman of the telecoms company.

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