Despite its best efforts, it seems Eircom is quite unable to keep itself off the news pages. Talks over the sale of its mobile subsidiary Eircell to Vodafone AirTouch have raised the spectre of a full-scale break-up of the group.

It will be up to the shareholders to decide - those same shareholders who put executives through the wringer at last month's a.g.m. Because Eircell accounts for the bulk of the Eircom valuation, the company will have to bring its proposals to an e.g.m., even if it has enough votes in the bag from its institutional shareholders.

Last time around, concessions were made on the price at which share options for up to 400 executives at the company would kick in. At that time, just after the company had recently hit a lifetime low of €2.37, the €3 target looked ambitious enough. However, a few things escaped widespread notice. First, the share had recovered from that low at the end of August, to €2.60 the day before the a.g.m. less than two weeks later. Second, the share had only fallen below €3 in mid to late June, largely due to the KPN/Telia share overhang. Irritating though that overhang might be, by the a.g.m, the company knew KPN was selling, a fact which, in itself, would bolster the price.

Had they done their homework, shareholders, including the fund managers, would have been aware of these elements. What they would not have known at the time the concession on options was made was Eircom was at that time talking to Vodafone - and others - about options which would affect the price favourably. As it was, within 48 hours of the talks being confirmed, the price had shot up to €2.95, although it has fallen back since. Of course, as the company would claim, the talks could always collapse. They might do yet . . .