Eircom sold its 63 per cent stake in the Golden Pages yesterday to Dutch publisher VNU for €185 million - its first major divestment since it was acquired by Valentia, a consortium of venture capitalists led by Sir Anthony O'Reilly.
VNU already held a 37 per cent stake in the Golden Pages, which employs 280 staff in the Republic and made €61.5 million revenue during 2001. The Dutch firm paid 11.2 times earnings before interest, tax and amortisation to take full control of the business.
The Golden Pages division produces the phone book and six golden pages directories in the Republic with an annual circulation of 3.6 million copies. It also distributes this data via electronic platforms such as operator-assisted directory services and the internet. The firm has 43,000 paying advertisers and is considered a cash cow by analysts.
Eircom would continue to have a relationship with VNU for the production of the phone book, a spokesman said yesterday.
It is expected Eircom will use the cash from its disposal to pay down some of the €2 billion debt taken on by Valentia when it took Eircom private last year.
Mr Philip Nolan, chief executive of Eircom, said the decision to exit Golden Pages reflected the firm's strategy to focus on the core fixed-line business.
Eircom is conducting a major review of its businesses and is analysing measures to become more efficient, including whether to outsource its entire IT division.
This decision would require the consent of the Employee Share Ownership Trust, which owns 29 per cent of Eircom.
