IN THE PAPERS
In the papers 26 March
26-03-2008
by Deirdre McArdle
Rating agency says Eircom could become a 'zombie' company | Comedy Central posts South Park episodes online for free downloading
The Irish Times reports that the announcement that almost 100 manufacturing jobs will be lost in Co Westmeath has been described as a massive blow to the area. Athlone-based electrical cable manufacturer Nexans Ireland has revealed it is to close its plant in the town this summer with the loss of 96 jobs. The company has been manufacturing power cables for the energy, industrial and general markets in Ireland since 1970.
The same paper says Viacom's Comedy Central cable channel is to post every episode of animated comedy South Park on the internet to attract advertisers and give fans a legal way to watch the show online. South Park Studios, a joint venture between Comedy Central and show creators Trey Parker and Matt Stone, is offering free, ad-supported videos of all 12 seasons of South Park on the show's website.
According to the Irish Independent Eircom could be in danger of becoming a "zombie" company, rating agency Fitch has warned. Zombie firms are defined as those bought by private equity in highly-leveraged deals shortly before the debt bubble burst last summer and are now judged to be worth less than they owe to creditors. Eircom, which was acquired by Babcock & Brown Capital in 2006 for more than EUR2 billion, has debts of EUR3.4 billion, while the company is worth at least EUR4 billion. "I would not say that Eircom is a zombie yet," said Edward Eyerman, head of European leveraged finance at Fitch. "However, it depends how sustainable the company's debt structure is and whether it is generating enough cash to manage its debt."
The Financial Times reports that mobile group Vodafone has said it expects to start receiving dividends again from Verizon Wireless next year. Verizon Wireless, the second-largest US mobile operator, emerged last week as the highest bidder in a radio spectrum auction. That development prompted fresh questions about when the company would resume dividend payments. Vodafone has a 45 percent stake in Verizon Wireless; the remainder is held by Verizon Communications, the US telecommunications group.
The same paper writes that Clear Channel's proposed USD19 billion buy-out stood on shaky ground Tuesday as private equity firms and banks remained at loggerheads over terms of the deal's financing. Neither side had been in contact for the past few days, according to a person familiar with the matter, suggesting a stalemate. Another insider said Bain Capital and Thomas H. Lee, the private equity sponsors, remained committed to the deal and were waiting for the banks to fulfil their funding commitments. People close to the banks -- Citigroup, Morgan Stanley, Deutsche Bank, Credit Suisse, RBS and Wachovia -- insist they are also still on board even though they would be likely to suffer losses on the Clear Channel loans.
The Wall Street Journal reports that US cable firms Comcast and Time Warner Cable are in talks to provide funding for a new wireless company that would be operated by Sprint Nextel and Clearwire, people familiar with the talks say. The partnership would create a US nationwide wireless network using WiMax technology. Under the plan the parties are reviewing, Comcast would put as much as USD1 billion into the venture, with Time Warner Cable adding USD500 million. Sprint and Clearwire have been working for months to cooperate on a WiMax rollout.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 