Telecom Finance, Issue 81 June 27 2001
Ernst & Young was appointed as administrators to Viatel Holdings (UK), Viatel UK Ltd, Viatel Communications (UK), Viatel Global Communications and Destia Network Services in early June. The holding company, Viatel Inc in the US, had already filed for protection under Chapter 11 in early May to facilitate the restructuring of its balance sheet and wind-up certain unprofitable businesses, principally in the US.
An agreement was reached later in the month for the sale of Viatel UK's customer bases and brands to a consortium led by Dr Asher Gratt, former joint owner and founder of Telco Global Communications which was advised by ARC Associates.
However, not all of Viatel's UK business was acquired in the deal. Viatel Communications UK network remains under administration and the exact number of switches is still being finalised. The acquisition predominantly comprises around 650,000 registered customers, mainly in the residential and the small business sector.
Viatel provides businesses and consumers with a complete range of all-distance voice, data and internet services, supported by advanced cross-border broadband networks in Europe, and extensive fibre-optic metropolitan networks in six of Europe's busiest business centre.
It is believed that interest has been shown by potential buyers in Viatel Global Communications (VGC). Energis, Cable & Wireless and KPNQwest have all been rumoured to have shown interest in the business.
Gareth Hughes, corporate recovery partner at Ernst & Young comments that "given the level of interest being shown in VGC, I am optimistic the administrators should be able to secure a sale of VGC's shares or business in the very near future."
Reproduced from Telecom Finance
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