Tiscali's auditors, Ernst & Young, raised doubts yesterday about the future of the Italian service provider, which heavily debt-laden. The auditor questioned whether Tiscali could continue as a going concern, and refused to sign off its accounts, according to the Financial Times.
Tiscali strongly disagreed with the auditors, the newspaper says, claiming it will conclude negotiations about a restructuring of its debt with banks led by JPMorgan and Intesa Sanpaolo.
Tiscali's shares closed down almost 7 per cent at €0.36. At €601.1m ($792m), Tiscali's net debt is more than three times its earnings before interest, tax, depreciation and amortisation. It reported a net loss of €242.7m for 2008.
Tiscali is a minor broadband provider in Italy while in the UK, it's the fifth largest broadband provider, losing ground to rivals such as BSkyB, which Tiscali was trying to interest in buying it out. BSkyB walled away from the deal.