Two and a quarter years after more than 500,000 investors ploughed their money into Eircom, the shares of the former State telecoms company were finally delisted from the Irish Stock Exchange yesterday.

The event draws a curtain on the biggest ever State privatisation and what subsequently turned out to be one of the more unsuccessful exercises in mass ownership in the Irish market.

Some 50,000 investors, who bought and sold their shares within a matter of weeks of the flotation, made money. The remaining 450,000 shareholders, who held their shares, are left nursing a 30 per cent loss on the €3.90 (£3.07) they paid for each Eircom share.

Most Eircom shareholders have now received the €1.33 per share from the Valentia Telecommunications consortium headed by Sir Anthony O'Reilly as well as a $0.035 dividend. They also have Vodafone shares received when the British mobile phone group bought Eircom's Eircell subsidiary in an all-share deal.

The former Eircom shareholders will need Vodafone shares to rise by nearly 80 per cent from their current level if they are to recoup their initial outlay in Eircom. That is highly unlikely to happen in the short term, although Vodafone's price performance over the past five years has been strong, albeit punctuated by heavy reverses.

The small investor's experience of the Eircom debacle, where the only winner was the Irish Exchequer, is likely to mean that investors will steer clear of direct investment in the stock market.

It will almost certainly mean that any future State privatisation - even of the few State companies that could be floated on the market - will not involve small investors.

As an exercise in developing a culture of investment in stocks, the investors' involvement with Eircom has been a disaster. The hype that preceded the flotation of Eircom was unprecedented but, with the benefit of hindsight, it is abundantly clear that the shares, at €3.90 each, were grossly overpriced. For every short-term investor who made a quick profit when the shares initially spiked up to €4.50-€5.00, there are nine others who believed the hype and propaganda about investing in a key element of national infrastructure and have been left nursing hefty losses.

On the other side the winners were the Exchequer, which ended up with an injection of more than €3 billion from the flotation, and Eircom staff who now own 29.9 per cent of the recently privatised Eircom and who stand to make windfall gains if the LBO-dominated Valentia meets the targets it has set itself.

The small investor has good cause to harbour bitter memories of the way the Eircom flotation was promoted as a quasi-patriotic exercise by the Government.

They have reason to feel bitter towards a management that, although it believed the flotation price was too high, did not stand up to a shareholder (the Exchequer) which wanted the top price possible without giving much consideration to the interests of the 500,000 people who bought the shares.

They have reason to be bitter about the involvement of the so-called "strategic partners", KPN and Telia, whose idea of partnership was to undermine the share price by publicly indicating their wish to sell.