Marconi appoints lawyer to aid debt restructuring

The troubled telecoms equipment maker Marconi yesterday appointed the restructuring expert Allen Thomas to its board as crisis financing talks with its banks and bondholders continue.

The move came as the company confirmed it had hired the financial restructuring firm Talbot Hughes to head up its refinancing discussions.

"Both these appointments strengthen the company's knowledge and experience in the financial restructuring process that we are now actively involved in," said Derek Bonham, Marconi's chairman.

Marconi, which has been in restructuring talks for the best part of half a year, is widely expected to sign a deal over the coming weeks that is likely to see shareholders diluted through a debt for equity swap.

Mr Thomas, 62, best known in the UK for his role in restructuring the technology firm BrightStation, takes up the position of non-executive director at Marconi with immediate effect.

He will take up the board seat left vacant by Baroness Dunn who resigned in early April citing a conflict of interest with her role as deputy chairman of HSBC, one of the banks leading Marconi's discussions.

The new non-executive, who was a partner in the law firm Paul, Weiss, Rifkind, Wharton & Garrison for 20 years, is also a non-executive on the board of the computer games company Eidos and the human resources firm Penna Consulting. He is also chairman of the Lloyd's insurer Ockham Holdings.

The company had pledged to update the City on its refinancing talks last week but postponed giving more detail until a deal had been struck.

It said yesterday that Talbot Hughes' founders, John Talbot and Chris Hughes, would now lead the financial restructuring process on its behalf. The pair, who are also working on the restructuring of the troubled telecoms company Energis, will report directly to the Marconi board as the company continues to thrash out a deal.

"John Talbot is the person that we have been looking for to help us drive the financial restructuring process and lead our negotiations with our bank and bondholder creditors," Mr Bonham said, adding the company's creditors had welcomed his appointment.

Mr Talbot was formerly a partner of Arthur Andersen where he ran the firm's corporate recovery business and then its corporate finance practice. Mr Hughes, meanwhile, was a former partner at PricewaterhouseCoopers where he was a senior partner in that firm's corporate recovery arm.

Marconi also announced plans to float its Strategic Communications business, which makes communications systems for the defence sector, on the Milan stock exchange by the end of September.