EBEON, which has been one of the State's fastest-growing indigenous technology firms, has laid off 170 staff and ceased trading after running out of cash.

More than 100 workers at Ebeon's Dublin headquarters were told yesterday the firm had gone out of business and they would not receive wages for January. The company's overseas offices in California, New York and London were also closed with the loss of 70 more jobs. Ebeon, which is 51 per cent owned by Eircom, is the most prominent indigenous firm to be hit by the volatility in capital markets.

Web consultancy Oniva recently announced job losses and yesterday Fyffes cut spending on its worldoffruit web portal.

Ebeon developed Internet technologies and provided consultancy services to a number of major corporate clients including Irish Life.

In a brief statement yesterday, the company said it had decided to cease trading immediately following its failure to secure funding or undertake an initial public offering.

Staff were due to be paid their wages for January later today.

One Ebeon staff member who contacted The Irish Times last night said they were shocked by the decision and were unhappy that they had not been paid.

"People have rent and mortgages to pay and while two months ago there would have been no problems finding a job, it's a little different now," said the staff member.

Mr Bill O'Donoghue, chief executive of Ebeon, said he was extremely disappointed that the staff hadn't been paid. "I don't have any cash to do the payroll," he added.

A bitter dispute between Eircom and members of the Ebeon board of management erupted as sources on both side blamed each other for the closure.

"We have pumped £21 million (€26.6 million) into the company and couldn't continue to bankroll the firm any longer," said one Eircom source.

Management at Ebeon said last night Eircom had pulled the plug on the firm after promising it additional funding in December. The sudden nature of the closure will be a shock to the whole technology sector. Ebeon had been aggressively hiring technology professionals and senior personnel until very recently.

Less than two weeks ago the company announced the appointment of a senior executive, Mr Rachid "Ben" Bengougam, who previously worked at the Nasdaq-quoted firm, Pegasus Inc. He relocated from Arizona to join Ebeon as chief people officer.

Ebeon was formerly named Trinity Commerce before changing its name in February 2000.

The firm's annual returns for 2000 show Mr Robert Booth, Mr Patrick Crawford, Mr Norman Crowley and Mr Jonathan Mills as other major shareholders.