A GROUP of subordinated lenders to Eircom has formed an ad hoc bondholder committee to engage with the Irish telecoms group on its financial restructuring.

The committee comprises about half of the payment-in-kind (PIK) note holders in Eircom.

The bondholders, who are effectively on the bottom rung of the ladder in terms of getting their debts repaid, have engaged Hawkpoint Partners Ltd as its financial adviser and Ropes Gray International as its legal adviser.

At the end of March, Eircom’s PIK debt stood at €643 million.

These notes are currently trading at between just 1 per cent and 3 per cent of their face value, indicating that the market believes that any payout from the impending financial restructuring of Eircom will be minimal.

Eircom declined to comment yesterday on this move by the PIK note holders.