IN THE PAPERS
In The Papers 7 September
07-09-2010
by Sylvia Leatham
Eircom bonds trading at massive discount | Calyx Group goes into receivership
The Irish Independent reports that some Eircom debt is changing hands at between 15 and 18 cents in the euro, as investors reckon the company cannot repay all of its EUR3.2 billion debt load. The massive discount on the most junior PIK (payment in kind) bonds reflects the view in the bond market that some Eircom debt will never be fully repaid. Even relatively senior Eircom bonds are trading at a discount of more than 40 percent of face value. Nonetheless, the trading price for PIK paper this week was actually up from around 12 to 15 cents in the euro last week, before the company announced results to the end of June. Despite being low, the prices suggest bondholders don't anticipate a complete write-off of the paper.
The Irish Examiner reports that hundreds of jobs could be at risk at a series of firms linked to the Calyx Group after the firm was put into receivership. In a statement, a spokesperson for the Kavanagh/Fennell insolvency practice said the IT firm had been put into receivership as the debt on its balance sheet was in excess of annual turnover of approximately EUR90 million. The 500 staff working with the business group in Ireland and Britain may now see their jobs put at risk. The Calyx group, which supplies managed ICT services, will be traded as a going concern while a buyer of the business and assets is sought. No redundancies have been made yet.
According to the Financial Times, former HP chief Mark Hurd is to become co-president of software maker Oracle. Late on Monday Oracle named Hurd as one of its two presidents and a board director, giving him a key supporting role to co-founder and chief executive Larry Ellison. Ellison has been one of Hurd's strongest public supporters since the surprise move by HP in early August to force Hurd out over breaches of its conduct of business rules. Hurd replaces Charles Phillips, a former Morgan Stanley analyst who left the company on Monday. In his new role, Hurd will be responsible for sales and marketing, among other duties.
The Wall Street Journal reports that the US Justice Department is trying to determine whether Google would gain too much influence over the online travel industry by acquiring ITA Software, according to sources. ITA powers the most popular airline-ticket search and booking sites on the internet. The merger investigation is at an early stage but, according to sources, Justice antitrust authorities are focusing on two potential areas of concern: whether rivals would continue to have access to ITA's data and whether Google would unfairly steer web searchers to its own travel services.
The paper also says that Toshiba will release a tablet computer that runs on Google's Android operating system by the end of the year. The company said it will sell the Folio 100 in Europe, the Middle East and Africa. It has yet to decide whether to launch it in other regions such as the US or Japan. The Folio 100 is equipped with a 10.1-inch multi-touch display and an embedded webcam. Unlike the iPad, the Toshiba tablet supports Adobe Flash for viewing videos on the internet. The move follows other forays into the tablet market by electronics manufacturers around the world. Samsung on Thursday unveiled the Galaxy Tab, while Sharp in July showed off prototypes of a tablet it plans to officially unveil later this month.
Free! "In the papers" email newsletter -- get the full text to your in-box every business day. Email itp@enn.ie with 'subscribe' in the subject line.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 