Viridian Group has sold its 50 per cent shareholding in the all-Ireland telecoms firm Nevada tele.com for a nominal sum to Energis, the company said yesterday.
Under the terms of the deal, the Northern Ireland energy group will be repaid £6.25 million (€9.81 million) in debt, which it is owed by Nevada tele.com, over seven years. This will be paid on terms comparable with Energis's bank facilities.
Viridian has also agreed to pay Nevada tele.com £4 million for certain telecoms assets used by Nevada to provide services to companies within the Viridian Group. But Nevada tele.com will manage the assets and continue to provision telecoms services to the firm.
Energis, which set up Nevada as a joint venture with Viridian in 1999, has said it will fund Nevada tele.com under a restructuring plan recently agreed by company management. Under this plan, Nevada would shed about 60 staff, reducing its workforce to about 110 people, Nevada chief executive Mr Les Harris said last night.
He said Nevada tele.com had increased its revenues during 2002 in the Republic, despite deciding to reduce its investment spend for the next few years.
The decision by Energis to assume 100 per cent control of Nevada follows a difficult period for the British telecoms company, which only recently avoided bankruptcy. Its financial problems were only averted in July when it was acquired by private equity firm Chelys Limited.
Figures released yesterday show Nevada tele.com faces a tough battle to turn a profit. At March 31st, 2002, the company had net liabilities of £14 million and its operating loss before goodwill, amortisation for the year to the end of March was £11 million.
Viridian said the disposal of Nevada tele.com was positive for earnings and fit its strategic objectives. Mr Patrick Haren, Viridian chief executive, said it represented a further focusing of its financial and management resources. "Against a difficult background, we have agreed a transaction which secures the future of Nevada and makes sense for Viridian and Energis," he said.
