Battle for Eircom won by Valentia after board agrees £1.7bn takeover

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Eircom, Ireland's biggest phone company, yesterday confirmed that it has agreed to accept a takeover offer of 2.8bn euros (£1.7bn) from Valentia Telecommunications.

Valentia is chaired by Sir Anthony O'Reilly, who is also chairman of Independent News & Media, publisher of The Independent. The consortium also includes the investment bank, Goldman Sachs, and the international financier George Soros.

The bidder has received irrevocable undertakings to accept the offer from Dutch phone group KPN and Swedish telecoms company Telia, which together control 35 per cent of Eircom's shares. The trustee of Eircom's employee share option trust, which is also a part of the Valentia consortium, is seeking approval from members to back the offer in respect of its 14.9 per cent holding.

Eircom has agreed to back Valentia's offer rather than a rival bid from Irish entrepreneur Denis O'Brien's eIsland group. Valentia and eIsland have been battling for eight months for control of the former government-controlled telecoms group. Eisland raised its cash offer for Eircom last week to 3bn euros (£1.8bn).

"The independent directors of Eircom intend unanimously to recommend that shareholders accept the Valentia offer," said Ray MacSharry, the chairman of Eircom.

Eircom offered itself for sale after disposing of its mobile phone business, Eircell, to UK giant Vodafone.