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Is Dixons Carphone set to sell B2B distribution arm?

Michael Garwood
May 11, 2015

Old Hugh Symons Communications (HSC) business not regarded as part of core business and is likely to be sold

Dixons Carphone is looking to sell the B2B airtime distribution arm of Carphone Warehouse Business following a post merger review.

Mobile News understands the airtime distribution business, which Carphone Warehouse acquired for £10 million back in 2006 (formerly HSC), is not considered part of the organisation’s future plans and is now actively seeking sale opportunities.

Dixons Carphone has so far refused to comment, but sources close to the company told Mobile News preliminary discussions have already begun with potential suitors.

Daisy, who acquired airtime distributors Fone Logistics, Anglia, MoCo and Redstone is said to have held talks, but refused to comment on “rumour and speculation”.

A number of hardware distributors are also said to be interested, but no firm names have been given.

CPWB has airtime agreements with O2, EE and Vodafone (One Net), managing around 150,000 connections and relationships with around 600 dealers.

“This isn’t about CPWB performing badly, far from it,” said an insider. “It’s a very successful and profitable operation, but it just doesn’t fit in to the Dixons Carphone strategy for the future and therefore is not considered core. Business sales are very important, but not through distribution.”

Daisy chain
Another added: “The feeling amongst Carphone Warehouse Business staff we’ve spoken to is that they will soon have a new employer. Daisy keeps getting mentioned and would be a perfect fit given its base of O2, EE and Vodafone customers mirroring that of Carphone. Whether network operators would back it would remain to be seen however.”

A sale would leave question marks over the future of the 50 plus staff working at CPWB’s head office in Poole.

A recent internal restructure of the division means it is now operating as two separate business arms; direct and indirect – with the latter focussed on airtime sales through the dealer channel.

The changes resulted in a number of staff cuts, including former franchise team leader Kristian Wingfield Bennett, (franchise programme was axed in January), connections team manager Sarah Lees, hardware account manager Robert Barrie, head of franchising Antony Vickery and hardware sales manager Lee Hankinson.

In addition, Dixons Carphone last week confirmed it’s to close its distribution and logistics centre in Wednesbury, East Midlands, putting 500 positions under threat of redundancy.

The firm said the closure falls within its ambitions to achieve “efficiency savings” of £80 million by 2018.

All operations at the Carphone Warehouse legacy site will be switched to Dixons 750,000 square foot site in Newark, 90 miles away.

Staff can either relocate or accept redundancy packages.

A Dixons Carphone spokesperson said: “Following much consideration, our distribution and repair centre in Newark has been identified as the most appropriate location for our growing business and so we will now consult with colleagues about relocating our Wednesbury operations to this site.

“Should our proposals go ahead, every single person will be offered a role in the new operation and to help our colleagues, we are offering considerable assistance to relocate or commute.

“Where colleagues feel unable to move, we are proposing significantly enhanced redundancy packages and redeployment support. We value the wealth of knowledge and experience in our colleagues and will be working very closely with everyone affected over the coming months to support them as we enter into consultations.”

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