Pictured: Alexandr Yesayan
This article was written by Dominic McGrath and appeared in the Business Post on December 15, 2024.
There are major opportunities in the Irish telecoms market, the co-founder of Armenian firm Team Group has said, as he celebrated the company’s purchase of Imagine Communications.
The wireless broadband provider, which is currently loss-making, confirmed this week that Team Group had acquired a majority stake for an undisclosed sum.
Existing shareholder Brookfield will retain a minority stake and said Imagine had worked “closely and constructively” with Dutch bank ING and others to find a long-term solution.
Team, which was co-founded by Alexander Yesayan, owns Armenia’s largest fixed-line telecoms operator and is the second-largest mobile operator in the country, servicing more than 1.1 million customers.
Yesayan, who would not be drawn on the price paid in the deal, said he was “100 per cent confident” that the Armenian company would be able to turn around Imagine, which is currently facing nearly €250 million in losses.
There is a financing commitment in place to support Imagine’s five-year strategy. But he said that it was too soon to put a figure on the potential growth of the current 40,000-strong customer base across rural Ireland.
Instead, the focus would be on improving service through new products, he told The Business Post. Yesayan, who started his career in telecoms with his brother at age 16 in 1998, said the fact that the Irish market was quite developed, especially in the wake of the National Broadband Plan, offered great opportunities.
“That’s where companies will start competing on the service level, right? The infrastructure is there. So then it comes (down to) who can provide better services and better offering in terms of the quality,” he said.
“And this is where we can differentiate ourselves based on our experience with providing state of the art service in Armenia to our telecoms subscribers, and the solutions that we have that we can implement and use the knowledge to make the connectivity better in Ireland as well. So this is where I see opportunity.”
The company’s expertise lies in fibre and IPTV, with Yesayan promising “very innovative solutions” to customers.
“We want to offer new packages and new offerings that are not done by competitors here,” he said.
The company chairman declined to offer specifics at this stage, but promised that his long-time friend Niall Tallon, an experienced figure in telecoms who first approached Team with the opportunity, would provide details soon.
“In telecoms, it’s not more competition about the speed offering. It’s about the quality of internet offerings. So for example, now it’s much more a matter how quickly the website is opening, rather than what is your download speed, because download speeds are already fast in the market.
“So it’s about latency for gamers, for example, for people who are using social networks or websites to have faster interactions. Once you click the website, you have the loading of the website as soon as possible on your device.
“A matter of seconds actually plays a big role from a user experience point of view.”
“This is where our knowledge comes about the traffic routing, how we organise it inside the telecom operator.
“So we give better user experience, not only the speeds. So this I think will also create a better quality of internet.”
The Armenian expansion into the Irish market is a major event for the post-Soviet country, Yesayan said, and is the firm’s first investment in any EU country.
He said there were “a lot of similarities between Ireland and Armenia, which comes to history, which comes to values and the struggles that our country has had”, and that he felt “very emotionally attached” to Ireland in that regard.
But Ireland also offers an important base from which to build further EU expansion.
“Ireland is very well positioned to enter into the European market,” he said, calling it “definitely one of the interesting angles for us to look into.”
The takeover nonetheless comes after a tricky spell for Imagine. The broadband provider reported an after-tax loss of €49.8 million for 2023 and the external debt owed to third-party banks rose to €26.6 million, due to be repaid this month.
The firm had also scaled back its five-year plan after new customer numbers fell, and they completed a redundancy programme in the first quarter of this year.
Still, Yesayan said he had no doubts that things were looking up.
“I have spent the last two days in Imagine speaking to the team. I think it has brilliant team members, and there is a lot of ideas, when we combine what we know with our ideas now and I’m 100 per cent confident that we will make this a success.”
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