Execs back $2.4bn Eircom buy-out

Danon in line for chairman's job

The former head of BT's giant retail business in the UK is set to take a top job at Eircom after the Irish incumbent announced today that it is backing a $2.4bn (£1.64bn) bid for the business.

Pierre Danon, the former chief exec of BT Retail, is due to become chairman of the Eircom once the deal is completed.

In an announcement today, execs at Eircom said they are behind a recommended cash offer for the business from Australian investors Babcock & Brown and employee group Eircom ESOP Trustee Limited.

A newly-incorporated business - BCMIH - incorporating Babcock and ESOP Trustee Ltd has been set up to handle the acquisition.

Current chairman Sir Anthony O'Reilly said the directors of Eircom "intend unanimously to recommend shareholders to vote in favour of the [deal]".

"The independent directors believe that the cash offer, which recognises the successful implementation of Eircom's stated strategy, is fair and reasonable and is in the best interests of Eircom ordinary shareholders, who will receive a substantial return on their investment since the Eircom IPO in March 2004," he said.

Last year, Eircom was being eyed up by European telco Swisscom. But that approach was blocked by the Swiss Government, which owned a majority stake in Swisscom, after it decided the telco should not press ahead with plans to expand overseas. ®