Banks set to back Marconi

TELECOMS equipment group Marconi's finance director John Mayo appears to have agreed a key part of his pay-off deal before publicly criticising the troubled company.

Mayo struck a deal last week on a pension worth £1m. He has already collected a £600,000 pay-off. Some smaller sums remain to be resolved.

More importantly for Marconi's future, banks appear ready to agree a new credit facility, with covenant conditions but without seeking charges on the company's assets. This would pacify the other large creditor group, the bondholders.

A string of disposals, though at modest prices, has eased the pressure on the telecoms equipment group. It has a near £1bn cash pile at present, which could rise to £1.5bn as cheques arrive from asset sales already announced.

Marconi said: 'We have been in negotiations with our bankers and are still talking. We will do this behind closed doors.' Banks say they are ready to give the group 'room to stabilise'.