Ionica Plc, the UK-based company which provides fixed telephone lines via radio links, is trying to put together a new financing package which will allow it to continue its network build out. The company currently has around 170m pounds to last it until the end of the year, but network capacity problems and a shortage of subscriber numbers have put Ionica in breach of its existing loan covenants, and it will not be able to draw down on existing 300m pound credit facilities. News of the capacity problems caused the company’s shares to crash dramatically last year and a new board has been assembled, headed by ex-British Telecommunications man, Mike Biden. It is expected that Ionica will replace the original loan facilities with a mixture of high yield debt and additional equity. The plans are to be revealed this summer. Network construction is not expected to be complete until 2004, four years later than anticipated.
