15th Apr 2015 11:33
LONDON (Alliance News) - Dixons Carphone PLC struck a deal on Wednesday to sell The Phone House Deutschland GmbH to German mobile virtual network operator Drillisch AG, part of a wider restructuring of its German business.
Dixons Carphone said the deal is expected to complete by the end of May and said it will receive around a 3% stake in Drillish as consideration for the business its is selling, with further deferred payments due on future excess cash flows from the Phone House business.
Dixons Carphone said the sale follows a period of significant restructuring in its German business and is in line with its strategy to focus on markets in which it holds a leading position and working in other markets via partnerships conducted through its Connected World Services division.
The deal also includes a long-term service contract to provide insurance to Drillisch, with scope to expand into further services in the future.
"Having previously announced the disposal of our retail operations and the closure of our wholesale hardware operations in Germany, today's announcement is a positive move to secure the future of the significant remaining operations within The Phone House Deutschland through a partnership with Drillisch AG, a highly professional, successful and growing business. At the same time, this transaction enables Drillisch to broaden its horizons into wholesale connection and dealer operations," said Sebastian James, Dixons Carphone's chief executive.
In December, Dixons Carphone said it was accelerating a review of its operations in Germany amid continued tough trading conditions. The group had previously closed down its retail and wholesale hardware businesses in Germany and booked a GBP9 million restructuring charge in its half-year results in relation to the closure.
Dixons Carphone shares were up 2.1% to 445.5 pence on Wednesday, one of the best performers in the FTSE 100.
By Sam Unsted; [email protected]; @SamUAtAlliance
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