EE agrees Phones 4u shop deal to save hundreds of jobs

The administrators of stricken retailer Phones 4u are expected to confirm the sale of about 60 shops to EE in a move that will save hundreds of jobs.

The final terms of the deal are still being thrashed out but an announcement is expected around noon on Monday. If the negotiations go to plan the sale of another package of stores could save between 300 and 400 jobs at the retailer which toppled into administration a week ago.

However it looks increasingly likely that the jobs toll from the retailer's collapse will run into the thousands.

Talks are continuing with other potential buyers, including international brands keen to enter the UK market and Dixons Carphone, which is thought to be interested in some shops.

Rival network Vodafone has already agreed to buy 140 stores, preserving 887 jobs, while Dixons Carphone has offered posts to the 800 workers who manned the Phones 4u departments in their stores.

So far the brunt of the chain's collapse has been borne at its Newcastle-under-Lyme head office, where two-thirds of the 1028 staff were made redundant last week. The company, founded by the entrepreneur John Caudwell in 1996, operated a chain of 560 stores and employed 5596 staff.

Although EE and Vodafone have now ridden to the rescue, it was their decision to stop supplying the retailer that precipitated its downfall, leading to a war of words with Phones 4u's private equity owner, BC Partners. Last week BC Partners accused Vodafone of having acted in a way "designed to inflict the maximum damage" on Phones 4u while it described EE's decision to also withdraw its business from Phones 4u as surprising.

Phones 4u sold mobile-phone contracts and handsets to consumers on behalf of operators but its business model was undermined as one by one the networks pulled out, choosing instead to open their own shops. O2 stopped selling through the retailer earlier this year and Three before that.

Powered by article was written by Zoe Wood, for The Guardian on Sunday 21st September 2014 19.22 Europe/London © Guardian News and Media Limited 2010


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