With final bids for Cablelink due in before the 10th of March union officials from ATGWU and SIPTU are meeting the company's management to discuss goodwill payments to employees when the company is sold. Cablelink has already made an offer to the 200 employees at a meeting on February 18 but the two unions are pushing for a higher offer in negotiations while the company is believed to be linking any deal to changes in work practices. While both side have acknowledged that the talks are taking place neither side is prepared to release any details of the issues being discussed.
The unions are also examining the possibility of shared ownership with the new owners of Cablelink. The Labour Court has ruled that a claim by SIPTU for a stake in the company would have to be decided by the new employer.
Analysts predict that the company could make between £200 and £300 million balancing the cost of upgrading Cablelinks old cable network estimated to be a possible £150 million against very high penetration in the greater Dublin area of 330,000 subscribers (valued at £1,000 per connected house on UK valuations). Also much of the value of Cablelink lies in the potential for its network to be used for telecommunications rather than the traditional TV channel business. Given the current vogue for acquisitions in the cable market world-wide it is expected the company will be sold at the higher price scale.
One of the front runners is expected to be the Cabletel Northern Ireland based subsidiary of US Cable Group NTL, which has invested £600 million in a complete fibre optic network to service 80% of Northern Ireland by 2003.
Also in the running are Princes Holdings (Irish Multichannel) , which is owned by Tony O'Reilly's Independent Newspaper Group and US Giant TCI holds seven of the franchises to operate the multi-channel, multi-point microwave television distribution system, (MMDS) and has substantial interests in 11 of the other 29 franchises. Others include Esat Telecom, United Pan-European Communications and CMI.
Cablelink was set up 30 years ago and is 75% owned by Telecom Eireann and 25% by RTE. Both semi-states have been instructed to sell their holding to facilitate greater competition in telecommunications
Michael McMahon 04/03/99
