Carphone Warehouse, Europe’s largest independent mobile phone retailer, is to spin-off its 2,400-strong retail network in a deal with Best Buy, the US consumer electronics retail giant. The deal will net Carphone Warehouse £1.1 billion and will lead to the creation of a 50/50 retail joint venture between the two companies. The new retail business will see the introduction next year of Best Buy stores across Europe that will sell a broad range of electronic consumer goods – a market both companies claim is worth around £89 billion and is being driven by the “convergence in entertainment, computing and communications.”
Carphone Warehouse will retain 100 percent ownership of its existing fixed-line broadband businesses in the UK – which comprise the TalkTalk, AOL Broadband and Opal brands – as well as its stake in Virgin Mobile France. Carphone Warehouse said it would use the proceeds of the sale to repay existing debt, and to further invest in broadband. Some analysts believe this could mean freeing up funds for the company to acquire Tiscali, the Anglo-Italian ISP that is currently up for sale.