ESAT Telecom has bought EUnet Ireland, an internet services company for a figure believed to be in the region of £2.5 million. Esat said last night the move would allow it to provide a full range of internet related services as part of its product portfolio. Although EUnet has just 2,000 clients, they are all high value corporate users, rather than individual consumers.

It includes the ESB and the VHI among its clients and is said to be growing rapidly. Founded in 1991, it currently employs 27 people.

Industry sources spoke highly of EUnet last night, saying the company has an excellent client list and is a very professional outfit. As previously reported in The Irish Times, Esat had been talking to EUnet for some time. Several other telecoms operators said they had also looked at the company.

Esat provides international and long distance services to 3,000 corporate customers and can now offer them a full range of internet services, while EUnet can market Esat telephony services to its own customers. EUnet managing director, Mr David Mee, said last night there was great synergy between the two companies and how they do business. He said the company's customers are large users of internet services.

It is understood that the current management team at EUnet will remain in place. The shareholders in EUnet are Mr Paul Kenny, formerly of NCB, businessman Mr Tony Kilduff, who is executive chairman of Reflex, The Horizon Computer Group and Horsforth, a venture capital company.

EUnet is the longest established internet services company in Ireland. It said yesterday it had increased its base of dedicated leased line and ISDN networked customers by over 160 per cent in the last year.

Sources said last night that an added bonus of the deal would be access to Esat's fibre network which the company is currently constructing in major Irish cities, as well as to the cable it is running under the sea. Also, for internet service providers who do not have their own networks, leasing lines can account for 60 to 80 per cent of costs.

Like other internet suppliers, EUnet is not making a profit, but its revenues are running at around £1.5 million at present.

EUnet Ireland is affiliated to EUnet along with 26 other European internet service providers, covering 42 countries.