Given that the accelerated deregulation of the voice telephony market is an undoubted bonus for Esat Telecom, the performance of the group's shares on Nasdaq since that announcement is, to say the least, discouraging. Esat shares traded up to $38 (£26.90) shortly after the deregulation announcement but fell back as low as $29 this week before recovering to $34.

Nasdaq being the market it is, substantial volatility in share price movements are taken as read. But is there any underlying reason why the investor attitude towards Esat shares should vary so wildly? After all, the indications are that the future is rosy for Esat, with the deregulation of voice telephony alone giving Esat access to a potential market of over £1 billion.

It is hard to believe that the dilution caused by the sale of 1.3 million new shares or Denis O'Brien's modest selling are sufficient cause for the shares to drop from $36 to $29, but there really seems to be no obvious reason, other than profit-taking by some American investors who got into Esat early.

The dilution that the new shares will produce is modest and does not warrant the sort of sell-off that Esat shares have suffered. That said, even the $29 low of this week is an awful long way from the $13 flotation price of last November.

The secondary offering of the 6 million shares 1.3 million new shares and 4.7 million being sold by investors in the November flotation should go well, but Esat, the selling shareholders and Denis O'Brien may not get the price it is hoping for and will do well to get anything near the $36-plus that the shares dealt at just before the secondary share offering was announced.

With Dublin broker Davy involved in the underwriting of the share issue, Esat will be hoping to get a good number of Irish institutions on the share register. But will Esat's problems with a Dublin share listing affect Irish institution's attitudes towards the share offering?

Local investors will probably favour Esat having an Irish listing mainly to have access to a local and liquid market in the shares. But with Esat apparently at odds with the Stock Exchange about whether a Dublin listing should be primary or secondary to the Nasdaq quote, it remains to be seen whether this will be a factor in Irish institutional reaction to the Esat share offering.