€400m Eircom broadband to go ahead as it seeks 'saviour'
EIRCOM will avoid a fresh round of jobs cuts and plans to press ahead with a €400m investment in super-fast broadband, even if the company goes into examinership, the Irish Independent has learned.
The company looks likely to seek examinership within weeks.
Even if it does there are no plans to reduce the overall number of employees beyond levels announced last year, despite the fact that Eircom has been forced to rewrite its long-term business plan because of faster than expected falls in revenues.
The new plan has been circulated to lenders and is likely to be at the centre of an application for examinership that could be made within weeks.
Under the plan a €400m investment to roll out fibre cable to a million homes and businesses will be completed in three years, not four as originally planned.
Last night Eircom confirmed that management and unions had agreed to retrain 400 field staff to work on the fibre rollout, to meet the new timetable.
It's a rare piece of good news for staff, who have been battered by two massive redundancy packages over the past three years.
Jobs fears have risen in recent weeks, especially after the company missed interest payments on some of its €3.7bn of debt.
Last year Eircom announced plans to cut 1,000 jobs over 15 months to get staff numbers down to around 5,000. The company had cut 1,800 jobs in 2009 and 2010.
Managers intend to press ahead with the plan to cut numbers to 5,000 by the end of August, but are not targeting a further reduction in staffing.
A spokesman said some further redundancies could not be ruled out in the coming years.
Eircom has been trying to find a buyer in recent weeks, with bids due to be tabled by end of business next Monday.
Few insiders expect much interest in the company.
The most likely scenario is for a 200-strong group of international banks and hedge funds to take control in exchange for writing off debts. That could be done through an examinership. If lenders do take control, a 35pc stake in the company that's owned by staff and former workers through an employee trust will be wiped out.