IRELAND’S main telecoms company Eircom will be formally put up for sale this week when its distressed Australian owner appoints investment bank UBS to find a buyer.

The company is one of several assets in Europe that Babcock & Brown put on the block last week as part of a sweeping restructuring plan.

It aims to jettison operations around the world that do not fall into its core infrastructure business and cut loose many of the satellite funds it formed and spun off in recent years in a desperate effort to survive. Investors have soured on its model that relied heavily on debt.

Assets for sale include UK groups International Energy, a £100m gas business, and storage business Space Maker. Babcock and associated funds also hope to unload CBRail, a European train-leasing company, a stake in Euroports, the ports-concessions company, and property assets in Germany, Austria, Japan and Australia.

BCM, the fund that holds a majority stake in Eircom and is partly-owned by Babcock in Australia, has agreed to buy itself out of the parent and seek a sale of Eircom, which could fetch €2 billion (£1.6 billion).

Any buyer is likely to create a new parent company so as not to disturb a €4 billion debt package Eircom has in place. ESOT, the employee share-ownership trust which has a 35% holding in Eircom, would then inject itself into the structure.

In Australia Babock is fighting for its life, but its European funds, in which the parent company still holds stakes, are keen to stress to investors that they are unaffected by the turmoil.

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