It has been revealed that accountants Ernst & Young are refusing to sign off the 2008 report accounts for UK broadband operator Tiscali. With debts approaching £450 million and the proposed £600 million disposal of the UK division in tatters, there is growing concern for the short term future of the group. Shares in the company are currently suspended and the directors are in talks with bankers regarding payment of outstanding debts although unless the UK broadband sale can be revived the future looks bleak.
Despite having around 1.8 million customers in the UK the broadband division has never really broken into the top league of the UK broadband sector. There are continuous rumours that Carphone Warehouse and Sky are still looking at the operation although, bearing in mind the desperate nature of Tiscali, any sale is unlikely to bring anything near the £600 million originally requested.
The last couple of weeks have seen a number of UK broadband operators targeting Tiscali customers with specific promotions and cashback offers. The longer the Tiscali situation continues without being resolved the more chance that customers will “jump ship” and look elsewhere for their UK broadband services. This really is make or break time for Tiscali!