Darty enters new agreement with Bouyges Telecom

3 May 2012

Darty enlarges its offering with a new commercial agreement with Bouygues Telecom

Kesa Electricals plc (the "Company" or "Group") announces today that Darty France ("Darty") has entered into a new commercial agreement with Bouygues Telecom ("Bouygues").

This commercial agreement is based on the strength of Darty's customer service and distribution network, together with the quality of Bouygues's mobile and fixed line offer. As part of this overall agreement, Bouygues is acquiring 99.9 per cent of Darty Telecom. The disposal is subject to regulatory clearance.

Thierry Falque-Pierrotin, CEO of Kesa Electricals plc, said:

"Darty France has developed a successful telecoms offer with a reputation for excellent customer service. This new commercial agreement allows Darty to enhance its telecom offer building on the state of the art mobile and fixed line services of Bouygues."

Under the new agreement, Darty will receive revenue streams based on the existing and future subscriber base and for the range of customer and management services that it will provide. These revenue streams taken together with associated costs and reduced capital investment will generate a retail profit and cash flow in excess of the current Darty Telecom performance. Bouygues will also pay €40 million for Darty Telecom; it is intended to reinvest the proceeds in the Group.

Darty Telecom comprises Darty Box and Darty Mobile which provide fixed line, broadband, TV and mobile to 340,000 subscribers. For the last full financial year ending 30 April 2011, Darty Telecom made a retail profit of €0.2 million on revenue of €131.5 million with gross assets of €78 million and net assets of €43 million.

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Jenny Davey