Italian ISP Tiscali is struggling to survive the recession, according to the company’s auditors. Accountancy firm Ernst & Young said that there were ‘fundamental uncertainties’ in Tiscali’s financial situation.

The company, whose UK business’s clients include Tie Rack and Unwins, has reportedly been trying to pay off its £450 million debt by selling its UK division, so far without success.

Potential suitor BSkyB turned down a £600 million offer earlier this year. According to an analyst quoted in the Daily Mail, the company would now struggle to sell the division for as much as £300 million.