Irish incumbent Eircom is talking to lenders to avoid the “significant risk” of breaching financial covenants within either three or six months, the company announced today.
Although the group is currently in full compliance with all financial covenants…
Irish incumbent Eircom is talking to lenders to avoid the “significant risk” of breaching financial covenants within either three or six months, the company announced today.
Although the group is currently in full compliance with all financial covenants for its E3.75bn net debt, discussions with lenders will commence in March and April to address its long-term liabilities.
Announcing Q2 revenues down 6% to E438m compared with a year earlier, CEO Paul Donovan said the group continues to face challenging trading conditions because of a harsh economic environment and changes in disposable income.
“Revenue losses have been partially offset by operational cost reductions, but it is vital that Eircom remains single-mindedly focused on its three-year transformation programme to reshape its cost base, to modernise and to generate new streams of growth,” said Donovan.
Gleacher Shacklock and JPMorgan are continuing to advise the group on a range of options, including a restructuring, debt swap or rights issue, a spokesman confirmed.
Linklaters and Arthur Cox are its legal advisors.
For the three months to the end of December 2010, Eircom posted adjusted EBITDA down 3% to E154m, compared with E159m for the corresponding period last year.