Comreg was only informed late last Monday evening, however, that Eircom had served Smart with termination notice and would be disconnecting its customers at 5pm that evening.

It is understood the regulator requested that Eircom delay cutting off the service for 24 hours to give Comreg time to place advertisements in the national media and alert Smart customers that they were about to lose their service but Eircom refused.

A spokesman for Eircom said the company had notified Comreg of the seriousness of its dispute with Smart "at the beginning of September" and made it aware of the likelihood that it would result in Smart customers being cut off. The spokesman also said Eircom had requested that the regulator put in place an emergency plan to help customers transfer to another operator.

Comreg commissioner John Doherty said last week that the regulator was "surprised that it actually came to pass". Eircom had issued Smart with 19 separate termination notices since June but prior to the fateful notice last Monday it did not carry out its threat. Eircom insists, however, that the regulator was aware of the severity of its dispute with Smart following the September meeting.

On Friday, meanwhile, Smart announced that a consortium led by its largest shareholder, construction millionaire Brendan Murtagh, plans to take over the company. Murtagh will pay a nominal fee of 1 for the company but will assume Smart's 40m debt and provide finance to ensure the viability of its broadband internet business, which is separate from the nowdefunct telephone division.

Smart's acting chief executive Ciaran Casey said the company regretted what had happened to its telephone customers but hoped to move forward and grow its broadband business, which currently has 17,300 subscribers.

"I think that we can trade our way out of this, " he said.