Uncertainty surrounds the future direction of midlands-based telecommunications company, Jupiter Communications, following the resignation of its founder and chief executive officer after three years of operation.
It is believed Jupiter Communications, which was established by physicist, Mr Chris Armstrong, may now become the target of an acquisition by an Irish based telecommunications company.
A spokesman for Jupiter would only say: "In the nature of a fast-moving industry like this, talks take place between certain players. Different shareholders may have different views to their own shareholding."
Sources close to Jupiter say Mr Armstrong's resignation follows a protracted power struggle between him and the company's two venture capital investors, Yeoman Securities and Delta Partners.
A spokesman for Yeoman International said the company was "not prepared to talk about it at all". No comment was available from Delta Partners.
From a majority shareholding along with a number of small private investors two years ago, Mr Armstrong's stake in Jupiter has now been eroded to less than 10 per cent of the company.
The Jupiter spokesman said that details of changes to Jupiter's shareholding structure were being concluded, and its advisers were in the process of preparing statutory returns for the Companies' Office.
The two primary investors, Yeoman International and Delta Partners, are now the main shareholders in Jupiter. They have appointed Mr Denis Reeves, formerly financial controller of unregulated business, and acting general manager of ESB's retail operation, to the position of chief executive officer designate. He currently acts as chief operating officer of Jupiter.
After initial negotiations for venture capital funding between Mr Armstrong and Delta fell through last August, Jupiter secured a £100,000 (€127,000) cash injection from Yeoman International, and an agreement to take a 33 per cent equity stake for nearly £2 million.
A US investor, Mr John McDonnell, president and chief executive officer of Transaction Network Services, is believed to have come on board at this point to share in the Yeoman investment of £2 million.
Whether TNS currently holds a stake in Jupiter is unclear. The Jupiter spokesman told The Irish Times his only understanding of TNS involvement in Jupiter was to advise one of the investors on technical issues.
The deal was delayed as Mr Armstrong sought a royalty agreement and sole right to the intellectual property behind the company. Jupiter offers a low-cost routing service on fixed line and mobile telephone calls.
The investors held off on striking a royalty agreement, and Jupiter came under operational pressure to raise funding. Under the most recent agreement, Mr Armstrong abandoned all claims to royalties, and agreed to stand down as chief executive officer and take on the role of chief technical officer.
Under the new arrangement, Yeoman and Delta took a 75 per cent stake in the company for £2 million, and reserved the right to appoint their own chief executive officer.
It is understood Mr Armstrong is leaving the company because he believes the situation is no longer tenable. This week he declined to make a statement on his current position with Jupiter, but said he was looking forward to embarking on a new venture. Mr Armstrong now plans to build a research and development company specialising in electronic commerce and electronics.
Jupiter has operations in Athlone and plans are underway to open in Galway. It is currently said to be generating revenues of £1 million annually, with monthly growth of around 8 per cent. The company has projected sales of £20 million within three years, once new products are added to the current offering.
