Ericsson, which employs 2,500 people in the Republic, has become the latest telecoms firm to have its debt rating downgraded.

Ratings agency Standard & Poor's cut its long-term rating to "A-minus" from "A" while its short-term rating fell to "A-2" from "A-1".

Last month, Ericsson announced 12,000 global staff cuts. It is not yet known if these will affect its operations in Dublin and Athlone.

It also emerged yesterday that Ericsson plans to raise some €1.653 billion (£1.3 billion) through a bond issue to boost its cash flow.

Investors service Moody's downgraded British Telecom's debt rating last week.