Fitch's assertion yesterday that the departure of Eircom's chief executive, Herb Hribar, could damage its credit rating should focus minds in the company's boardroom. The company should move quickly to replace him, if only to avoid the sort of uncertainty highlighted by articles such as those from Fitch.
Hribar left last month after plans for a flotation, which he was apparently not very enthusiastic about, were pulled at the eleventh hour. Eircom had no growth story to tell the markets, and so it couldn't tempt investors to stump up based upon the sort of valuation that its lender-owners wanted.
The company is now likely to bide its time for another year or 18 months before having another stab at a flotation. It will need topline revenue growth by then to convince investors that it has the ability to sustain paying dividends into the medium term. What sort of chief executive should it go after to deliver this?
Hribar was a “wires and pipes” man, a former networks director of the company who returned to lead it following its 2012 examinership. He impressively oversaw the rollout of its fibre network in his stint holding the reins. Under his leadership Eircom caught up, in an infrastructural sense, with its rival UPC, which had invested heavily in its network while Eircom was being handed around the houses by different owners.
There is a sense, however, that now that Hribar has gone, the company should seek a new leader with an altogether different set of competencies. The “wires and pipes” are being rolled out at pace under plans devised by Hribar. Now, the company needs “content” to fill them. In coming years, Eircom will spend much of its time striking content deals with broadcasters, digital media publishers, music companies, newspapers and other such entities.
Richard Moat, its acting chief executive and the finance chief under Hribar, is a highly experienced and capable corporate executive. It is unclear whether he will put himself forward for the role long-term. Either way, he is likely to have competition from others with strong “content” backgrounds.
Eircom is not just an infrastructural company anymore. It is a digital media company, and its next leader will have to run it as such.
