The ESB has sold its nationwide network of retail outlets to British bank HBOS for €120 million in a deal which is certain to shake up the Irish retail banking market.
The deal provides HBOS's Irish subsidiary Bank of Scotland Ireland (BOSI)
with access to a nationwide network of 54 branches and the ESB's 'FinancElectric' consumer loan book.
The ESB Shop in Fleet Street, Dublin.
The ESB Shop in Fleet Street, Dublin.
The Bank will also provide the ESB's 'Bill Pay' and cash management facilities offered through these branches which will give it access to over 185,000 existing customers, to add to the bank's existing retail customer base.
Under the deal, BOSI will offer to retrain staff working in the ESB shops as bank cashiers. ESB will retain its Fleet Street building in Dublin and its Academy Street premises in Cork, though not as retail units.
ESB chief executive Padraig McManus said: "This is a highly positive outcome for ESB and for staff working in the shops, giving them new careers in an expanding banking business, as well as being good news for the towns and communities involved."
ESB Retail's share of the market in Ireland has fallen from 24 per cent in 1985 to a current level of 6 per cent. ESB originally operated over 100 shops and has gradually scaled that figure down including the closure of 33 [er cent of its outlets in 2003. Proposals for further radical rationalisation had already been tabled.
BOSI said
the deal will provide Irish consumers with "real choice" in their banking by the end of the year.
The transaction is due for completion by July 1st and Bank of Scotland Ireland will open its refurbished branches on a phased basis with the first branches expected to open by November.
Electricity Supply Board Officers' Association General Secretary Mr Tony Dunne said his union was opposed to the selling of any part of ESB .
"This development came as a complete surprise particularly when the union and the Company had been engaged in good faith in restructuring discussions for the past couple of months," he said.
"This process was now before the Joint Industrial Council.
"The ESB shops have been an integral part of ESB 's operations since its earliest days and had played a major role in providing credit facilities for goods to many in the community who would not have had such access to credit.
Mr Dunne said the union leadership would be meeting with management to discuss the serious issues of the proposed sell off of the business and outsourcing of functions currently performed by ESB staff.