Esat Telecom will officially announce next week that it is to bid for Cablelink. It is thought the company will link up with a US/ Canadian cable group, but Esat may not disclose the name at this stage.
Potential bidders must signal their interest in Cablelink by close of business on Wednesday. They will also have to indicate a figure which they would be prepared to pay.
Esat's entry will end weeks of speculation about the company's intentions. The company has taken a very low key approach to the competition. However, industry observers believe it has to bid for Cablelink, seen as a very valuable asset. It is possible that whoever succeeds in buying Cablelink will become the second biggest operator in the State, a position currently held by Esat.
Esat will be seen as a strong contender, given its strong presence in the market and strategic accumulation of data and voice services. Getting Cablelink would complete its positioning as a full service communications company, providing fixed, mobile and multimedia services.
It is expected the number of interested parties will approach a dozen. Those who have declared that they will definitely bid include US cable group TCI and Princes Holdings, an Independent Newspapers subsidiary and Dutch cable group United Pan-European Communications (UPC). Cable Management Ireland (CMI), which has franchises in north Dublin, is expected to bid in conjunction with a partner, as is NTL, whose Cabletel subsidiary is rolling out a network in Northern Ireland.
Cablelink has 350,000 subscribers, mainly in Dublin. It is estimated that it could fetch in excess of £300 million, although some potential bidders feel this figure may be a little on the high side. Although it needs substantial investment to upgrade its services, its access to homes and businesses is very attractive to investors.
Following the initial indications of interest, the parties will be asked to send in more binding bids. A shortlist of five or six potential buyers will then be drawn up and the sale will be completed by the end of May.
