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Carphone Warehouse splits mobile and broadband

Alex Scroxton

The Carphone Warehouse has announced it will split its mobile business and TalkTalk broadband units into two separately listed firms.

The move follows a strategic review of its group structure initiated last year.

Speaking on Wednesday morning, as the firm updated the market on its fourth quarter trading results to the end of March, Carphone CEO Charles Dunstone said: "We believe shareholder value will best be served by a de-merger of the two operating businesses to create two separately listed companies.

"However, the timing of any de-merger will depend on the cost and reallocation of the Group's credit facilities. Meanwhile, the operational separation of the two businesses has effectively been achieved," said Charles Dunstone.

The company said the demerger will allow it to create two discrete businesses with distinct investment profiles and improved comparability with competitors.

Dunstone plans to remain on board as chairman of both companies, if the demerger is approved by shareholders.

The firm did not disclose any numbers, but said it expected full-year earnings to come in line with expectations. Carphone Warehouse forecasts revenues and profits will be largely flat during fiscal 2010.

Meanwhile, Carphone's joint venture with US big-box electronics retailer Best Buy is pressing on regardless. Earlier in the week it revealed plans to open 30 stores in the UK during calendar 2010.

This story orginally appeared on MicroScope.


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