A good fit for both companies
US consumer electronics giant Best Buy and UK independent mobile phone retailer The Carphone Warehouse (CPW) announced the creation of an as yet unnamed new company today.
It will strengthen CPW’s retail operation and introduce Best Buy stores across Europe.
Best Buy will acquire half of CPW’s European and US retail interests, including CPW’s Best Buy shareholding, for £1.1 billion. CPW will use the proceeds to reduce debt and to invest in its broadband operation, as well as in the new company.
The new company will comprise CPW’s 2,400 stores, and its web, direct, insurance and airtime reselling businesses. CPW’s fixed line telecoms business in the UK (TalkTalk, AOL Broadband and Opal) and its share of the Virgin Mobile France joint venture are not affected.
We reported advance notice of the new venture on 17 April. It is the culmination of a long process of familiarisation and exploration of common interests between the two companies.
“We have been working closely with Best Buy for nearly two years,” said CPW CEO Charles Dunstone, “and it is clear that we have very complementary cultures, skills and assets.” “We are joining forces with a leader in consumer electronics retailing to enter a major new market together,” agreed CFO Roger Taylor. “Best Buy’s track record of value creation speaks for itself.”
“Our cultures are similar,” said Brian Dunn, President of Best Buy, “and we share a mutual trust and common values.” “We believe that we can collapse time, increase our success with consumers and create more shareholder value for both companies by pursuing our goals together,” added Brad Anderson, Vice Chairman and CEO of Best Buy.