Eircom Board recommends Valentia offer
Friday, 3 August 2001 18:37
The Board of Eircom has recommended to shareholders the latest Valentia offer for the take-over of the former State phone company. The Tony O'Reilly-led group now has 28 days to post their formal offer to shareholders.
The consortium, which is headed by Tony O'Reilly, earlier said that it was prepared to raise its bid to ¤1.365 in cash per share, including a three cent dividend. This is half a cent higher than the offer of ¤1.36 from the eIsland group, led by Denis O'Brien.
Comsource, which is owned by Sweden's Telia and Dutch KPN, has given a commitment to Valentia that it will sell its 35% stake in Eircom to the O'Reilly-led consortium. Comsource can only be released from this agreement if a rival bid goes above ¤1.50.
Valentia has also secured the key backing of the 15% shareholder, the employee trust ESOT.
The eIsland Group has issued a statement pointing out that Valentia's latest approach is still not a formal one and that certain technical issues must be resolved before a formal offer is made. For example, the Takeover Panel must approve a timetable for the new bid.
However, these technical issues are expected to be resolved either later today or early next week.
