The Scandanavian telecommunications company Newtel today made a $1.5 billion bid for the Irish phone company Esat Telecom. Newtel is an amalgamation of the Norweigan state phone company, Telenor, and the Swedish phone company, Telia. This evening the Irish company, which is led by Denis O'Brien, urged shareholders to reject the offer. In its short existence Esat Telecom has become a serious player in the Irish phone market and is now in many areas of the industry is causing headaches for its main competitor Eircom. But the success it has achieved is now perhaps the main reason the bid has been made.
Few companies would know Esat so well as Newtel. Telenor of Norway, one of the companies that makes up Newtel owns almost half of Esat's mobile phone subsidiary Esat Digifone. At $72 per share the offer values the Esat Group at just over £1.5 billion. The Scandinavians believe it is a full and fair price. It is understood that there is interest on both sides of the Atlantic in Esat. A higher bid is expected.
