The Australian group which has tabled a fresh bid for Eircom has told shareholders in Eircom's parent company that the Irish government's current banking problems should make it easier to squeeze more concessions from government ministers.

The Minister for Communications, Eamon Ryan, is expected to respond to the remarks early next week. The bid, from a group called Taemas Bridge, wants to set up a special-purpose vehicle ringfencing Eircom and possibly other investments.

The shareholders of current Eircom owner Babcock and Brown Capital (BCM) would be paid cash for their existing shares and given the option to take equity in the new vehicle, to be called Liffey Bridge.

The idea behind the bid however is to extract concessions from the government, bond holders, unions, pension trustees and the Employee Share Ownership Trust (ESOT). Taemas Bridge has placed crucial importance on the current weakness in the Irish government's negotiating position.

In a section of its document proposing the bid, it states: "Government can't afford a defaulting telco alongside three defaulting banks."

The consortium, which includes ex-Eircom boss Rex Comb and former Babcock executive Rob Topfer, is offering to work with government on a new national broadband rollout. However in another part of its document it suggests capital expenditure plans are likely to be scaled down in the period ahead and wage freezes and redundancies will be demanded from employees.

The Taemas Bridge group is predicting Eircom will be facing a debt default within 18 months, although the government and unions do not believe this assertion at this point.

The company's crippling debt burden has hampered spending in infrastructure for some time in the eyes of the firm's critics. For example, among the covenants governing the debts of the company is that capital expenditure can only be ramped up to a certain point.

Bondholders have the right to reign in spending if the covenants are close to being breached. Eircom has since 2006 been the most highly leveraged telco in Europe, based on its net debt to EBITDA ratio.

Eamon Ryan is likely to spell out a range of concerns about the Liffey Bridge proposal, but is likely to stop short of advocating re-nationalisation.