Reprieve for Ireland's Smart Telecom customers
The 45,000 disconnected Smart Telecom customers should have some phone services returned within three days following 'intensive discussions' between Eircom and telecoms regulator ComReg.
Smart Telecom subscribers should soon be able to make local, national and emergency calls after infrastructure owner Eircom, who denied Smart Telecom access to its network on Monday night over unpaid debts, reached an interim agreement with ComReg on Tuesday evening. Industry sources suggest Smart customers could be able to make calls as soon as today.
The regulator said once these interim arrangements had been completed, Smart subscribers will be able to transfer their custom to any telephone provider of their choice. It's unclear at the moment what happens if a customer elects to stay with Smart Telecom.
As a result of Eircom denying Smart Telecom access to its network over a &1.7m debt, several competing broadband and phone companies have made statements to the media offering scathing views on Eircom's actions while advertising their alternative services to disgruntled Smart customers.
Imagine Broadband was the first to offer alternative services to Smart's 17,000 broadband customers, and claims to be able to reconnect them within three days.
A BT spokeswoman told ENN that 40 per cent of the enquiries to its call centre on Tuesday were from Smart customers, and it is conceivable that Smart will loose thousands of its voice customers from a business unit it has been trying to sell over recent weeks.
Smart Telecom revealed its financial difficulties at its AGM last month when it announced its staff was to be cut to 100 from around 400 previously, and that it had appointed NCB Stockbrokers to seek expressions of interest in its phone, call card and payphone business units.
The struggling company's main backer, with a 20 percent stake, is Kingspan and Howard Holdings construction magnate Brendan Murtagh. The businessman - estimated to be personally worth in excess of €500m - has been bailing out Smart with subventions of EUR3 million per month.
It has been confirmed to ENN that Murtagh, and other family members recently appointed to Smart's board, have agreed a last-minute refinancing package which may prevent Smart from facing liquidation.
Although Smart has already suspended trading on London's AIM market, the Murtagh rescue plan will reportedly include a complete delisting from the exchange and a €10m cash injection.
Smart lost €36m in the first half of 2006, and may have lost considerable goodwill and brand image over the most recent debacle. However industry commentators have suggested the company has an "attractive and viable business plan" in relation to its broadband business.
Copyright © 2006, ENN