More than 170 staff at Ebeon, a technology firm in which Eircom holds a majority stake, were laid off without any wages last night as the firm announced it had run out of cash and gone out of business.
Management said the firm, which developed Internet technologies, had failed to raise adequate funding to continue operations and could not afford to pay staff wages for January.
One staff member told The Irish Times the announcement had come as a complete shock. "People have rent and mortgages to pay, and while two months ago there would have been no problems finding a job, it's a little different now," said the staff member.
The sudden closure of one of the State's fastest-growing indigenous technology firms will send shockwaves through Dublin's technology sector.
Ebeon, which is 51 per cent owned by Eircom, established offices in California, New York and London in the past 12 months and was aggressively hiring until recently.
However, sentiment towards the technology sector has changed in recent months due to prolonged turmoil on stock markets. Several prominent technology firms have announced job cuts recently including the web consultancy Oniva and the Internet bank First-e.
Further evidence of the technology cash-squeeze was provided yesterday by the banana company, Fyffes, when it announced cutbacks at its Internet portal, worldoffruit.com.
The firm said it had failed to attract venture-capital support and half its 20 workers had lost their jobs as a result.