Mr Denis O'Brien rejected as "disgraceful" a suggestion yesterday that Esat entered a sweetheart deal with CI╔ to build a telecoms network on its railway.
In his first appearance at the inquiry into a £36 million overshoot on an Iarnr≤d ╔ireann signalling project, he claimed more purpose would be served by investigating an ESB joint venture with British Telecom, known as Ocean. Mr O'Brien said Esat had sought to do business with the ESB but it refused to meet his company and chose instead to link with British Telecom.
Mr O'Brien has faced questions at the Moriarty tribunal about payments to the former minister for public enterprise, Mr Michael Lowry TD, who granted the State's second mobile phone licence to Esat Digifone. His appearance yesterday before a subcommittee of the Oireachtas Joint Committee on Public Enterprise and Transport centred on the construction of Esat's land-based network along Iarnr≤d ╔ireann's rail track.
The State company's signalling programme ran aground as it built the Esat system. The inquiry has heard that the system was a substantial asset to Esat, although the project undermined the signalling plan, which is still incomplete.
The deal was negotiated for Esat in June 1997 by its then acting chief executive, Mr Leslie Buckley, who had spent most of 1996 working as a consultant to Iarnr≤d ╔ireann.
Mr O'Brien was sworn in at 10 a.m. but had to wait for more than three hours before his questioning by Mr Pat Rabbitte TD began.
Outlining the development of Esat's business in the 1990s, he said his involvement in the CI╔ project was not great. "My role in this was initiating the idea, helping to formulate one of the presentations - in other words, I would have edited it - and going along then to sign the contract.
"That was it, and writing the odd letter that I was asked, as chairman or CEO of Esat, to write to CI╔. Other than that, nothing else."
Before his cross-examination, he had tetchy exchanges with the inquiry's chairman, Mr Seβn Doherty TD, who asked if the Esat-CI╔ agreement was a "sweetheart deal".
Mr O'Brien said it was plainly evident it was not. "If you have any notion that this was a sweetheart deal, I think it calls into question your ability to make any assessment," he told Mr Doherty. Mr Doherty said that was not implied and pointed out that Mr O'Brien was not entitled to ask questions of the inquiry.
Earlier, he dismissed a 1994 CI╔ paper on a possible telecoms initiative, which was discovered to the subcommittee by Esat. The paper was also dismissed by CI╔'s former chairman, Mr Brian Joyce, who said it was work worthy of only a first-year commerce student.
Tension also surfaced yesterday between CI╔'s former property manager, Mr Jim Gahan, and Mr Rabbitte. Mr Gahan accused Mr Rabbitte of asking "offensive" questions on the appointment by CI╔ of a consulting firm to advise on its agreement with Esat.
While the inquiry has heard about a raft of consultants being taken on by CI╔, Mr Gahan said the group employed Norcontol to advise it only after heads of agreement were reached with Esat in June 1997.
Conscious that deregulation of the telecoms industry might provide an opportunity to generate additional revenues from the railway, the group had conducted a trawl of telecoms groups from January 1996.