Staff Reporter

Vanguard paid 2 million in cash for all the assets and employees of the two PNC trading divisions including all 54 KJC shops staff and PNCs Corsley Heath head offices. Vanguard has also taken on a number of PNCs liabilities and debts.

Vanguards chief executive Paolo Fidanza said the company had no plans to redeploy any PNC staff saying the acquisition was a perfect fit.

We have no redundancies planned. Rather we plan to grow the business he said.

We are forming a group of companies. There is no overlap between KJC PNC and our own activities. The acquisition of PNCs fixed-line business and the KJC chain provides us with a full range of products and services.

He described Vanguard as a complete telecoms company saying we have an opportunity to offer a full range of services for our customers. Fidanza added that KJC shops would see immediate investment.

We are starting to invest in the shops with new levels of stock. We also want to create areas within the stores where we can demonstrate content.

We want the stores to offer more than just boxes. The stores will have areas to support business needs. We also want people to come in and experience things like games and ringtones.

We want to change the idea of mobile phone shops and take it to the next level. The shops wont disappear. There will be more acquisitions.

Fidanza refused to compare Vanguards purchase of PNCs fixed-line business to the Carphone Warehouses purchase of Opal Telecom however.

We saw an opportunity to get in to the fixed-line business. We estimated that premium-rate content business is worth 1 billion per year. We aim to provide content for 3G handsets.

The acquisition of PNC gives us a network to deliver that content and a billing system.

PNC founder Geremy Thomas slammed the decision by PNC board members to sell the company so cheaply having recently battled to rejoin the board in order to prevent this.

I tried to safeguard the interests of shareholders but failed Thomas admitted.

His move was rebuffed by PNC chief executive Ian Gray who claimed that Thomas blocked all attempts to sell the company earlier in the year leaving PNCs board with no other options.

We had higher offers for PNC earlier in the year but Thomas blocked these said Gray. We had other options open to us including fundraising but again these were blocked.

Suppliers were starting to cut credit lines. The sale to Vanguard was one of our last options. I am a shareholder. I have lost money but that is business.

Gray also confirmed that PNC would continue to battle former chief executive Darren Ridge on misconduct charges (Mobile News April 22).

When the network unveiled its handset and tariff packages in February it promised the first 20000 users on the Kit and Caboodle tariffs ( 59.99 and 99.99 a month) half-price handsets saving them 200.

People who chose the 3toGo plan had to pay the full 399 for the NEC 606 and Motorola A830 handsets. But 3 will now extend the half-price offer to the pre-pay option.

This is the first time a high-end handset on pre-pay will be available for the same price as on contract.

Dealers will still receive their 85 commission. 3 customers who paid 399 for 3toGo handsets will not receive any form of compensation.

3 has also extended the period over which it will be offering the half-price handset discount. The offer was to last until the end of April but now it has been extended until the end of May.

We are extending the period in which customers can sign up for a reduced price handset to take full advantage of the interest created by our first phase of advertising said a 3 spokesperson.

With the 3toGo offer we are reacting to the wishes of the market. A huge number of customers have shown interest in pre-pay but want the handset reduction. We always knew our Kit and Caboodle tariffs would be popular with high-users. With the 3toGo plan we have the chance to appeal to a customer who doesnt fall into this category.

The price of the Motorola handset has come down by an extra 74 to 125. It had cost the same as the NEC 606 but the Motorola has been an unpopular choice because it lacks video calls although it does offer video messaging. Unlike the 606 however the Motorola supports GPRS downloads.

3 has also started advertising for new store managers and staff for its stores within stores set to open within Superdrug stores before the end of April. The first stores are rumoured to be in Reading and Uxbridge.

3 has confirmed Fone Logisitics as its third distributor along with Avenir and Hugh Symons.

Vodafone is closing stores in towns that have more than one Vodafone shop.

They are Blackpool Huddersfield Wakefield Derby Colchester Coventry Maidstone Exeter Plymouth Ipswich Hull Croydon York Edinburgh Norwich Hanley and Bangor (Northern Ireland). Four of the affected towns have more than two Vodafone shops.

On the positive side Vodafone will open five new Experience stores this year with the aim of reaching a total of 313 shops.

Vodafones head of retail sales Richard Daly says the network is doing all it can to re-deploy affected staff elsewhere in the company:

Daly said. We are looking to re-deploy people in new stores or elsewhere within Vodafone. Some people may use the opportunity to move elsewhere.

We will refurbish some stores and are in the process of building four new experience stores.

Daly denied Vodafone had scaled back its retail plans.

We have never stated that we would build a chain of 340 to 360 stores he said. We have the right shape for a national chain now with 310 to 315 stores.

Vodafone Retail was formed by the merger of four chains. In some towns we inherited up to three stores. The market has changed and so has the function of the shops.

We no longer need more than one store in each town to service our 13 million customers and inbound roaming customers from overseas.

The news comes only weeks after The Link announced it was culling six shops in Central London and reflects the fact that the mobile phone market has reached saturation point in the UK with approximately 50 million customers.

Gary Brown 31 a carpenter from Ilford London is alleged to have abducted the girl in front of her mother outside St Johns Wood tube station on March 4 and then stole a mobile phone from a flower seller who intervened.

Brown was remanded on bail despite objections from the prosecution.

The award was made in recognition of how the Manchester United alliance had been used by Vodafone UK to help meet its overall business objectives while achieving high levels of media coverage and awareness levels among football fans.

Vodafone UK marketing director Lance Batchelor commented:

We are delighted that our work with Manchester United has been recognised with this prestigious award.

We have always been more than just a name on a shirt. By working closely with United we have put an extensive support programme in place so that as many of the areas within the UK business can benefit from the commercial alliance as possible. This award recognised our achievement in fully integrating the sponsorship into our business.

He joins NextGem managing director and founder Kevin Gooding.

Gooding commented:

NextGem is aimed at helping software developers to market their products into 2.5G and 3G mobile markets and where necessary join complementing technologies together. Grahams wide experience in the cellular industry will prove invaluable to NextGem.

Cornhill added:

The content industry will be the main driver of income to both 2.5G and 3G markets in the coming years. NextGem understands the content market and how content apart from being saleable must interact comfortably with network operational systems if it has any chance of success. There are still huge earning opportunities from 2.5G for the next couple of years. NextGem will be delivering applications that will create valuable revenue streams now.

Siemens created the Xelibri as a fashion accessory to be sold over new channels such as department stores and fashion retailers

The ruling imposes reductions on the call termination charges levied by all UK mobile networks. Income from these accounts for a quarter of mobile network operators revenue and a much higher proportion of profit.

PricewaterhouseCoopers said the reduction in handset subsidies and raising of tariffs could mean existing mobile users may cease being mobile subscribers altogether if they have to upgrade to more expensive handsets and monthly charges.

According to PricewaterhouseCoopers regulatory intervention could harm the development of markets for new services which need to develop before the need for regulation is assessed.

The outcome of the Competition Commissions ruling represents a significant downside for UK mobile network operators and consequently for consumers said PricewaterhouseCoopers partner Graeme Clark.

TCL went into receivership in November 1999 with debts of around 3 million and rumours that it had been affected by dealer fraud and tight margins on pre-pay.

In 1998 it had a turnover of 21 million and employed 130 staff in 39 retail outlets. It also had a base of around 300 dealers connecting through Phones 4U.

A recently-published administrators third annual report noted that a dividend may become payable to preferential creditors after monies that were diverted from the companys funds were recovered by the administrator.

Although the liquidator would not give precise details of how much money was recovered he did indicate that a certain amount had already been recovered and that an investigation had been launched to recover a substantial amount more.

Liquidators must submit a report to the Department of Trade and Industry Disqualification Unit. One has been completed on TCL directors Tony Lane John McLuskie Terry Cork and Rob Musk. It is unknown if this report includes details of the funds that have been uncovered.

This means the Government will grab back all the luxury goods he bought with the proceeds of the 3.5 million he laundered through an offshore company as his share of the proceeds of a vast VAT carousel fraud.

These include a Bentley a Jaguar a Toyota Land Cruiser a yacht and a seven-bedroom mansion in Wales. Evans imprisonment came as the climax of a Customs and Excise investigation called Operation Dunaway that started in October 2000.

The probe started when Customs investigators were alerted to a used car dealer called Robert Garner who was selling mobile phones. Suspicions were aroused when Garners turnover soared to more than 20 million in one month compared with his normal annual turnover of 2 million a year.

Garner was arrested and charged with VAT evasion after Customs linked him to three missing traders who disappeared owing 35 million in VAT between June and November 2000.

Further investigations showed the missing VAT monies had been channelled to two companies in Ireland and Spain set up by an ex-pipe fitter and cafe owner called Raymond Woolley who fled to Spain before he could be arrested.

In January 2001 Customs investigators discovered that 8 million had been transferred from Woolleys two offshore companies to a client account at a Staffordshire solicitor. Senior partner Paul Morris handled the account.

Another client account was for an offshore company set up by Evans in the British Virgin Islands. Around 3.5 million was siphoned into this account and was eventually used to buy several expensive cars a yacht and the North Wales mansion.

Morris and Evans were both arrested and charged with money laundering. Woolley was eventually arrested in Schipol Airport en route from Hong Kong to Marbella.

In December Garner was sentenced to seven years three months. Woolley pleaded guilty to money laundering offences and got nine years the longest sentence ever handed out for VAT offences.

Last month Morris and Evans were sentenced. Morris got five years for each of three counts to run concurrently. Evans got three years on each of two counts to run concurrently.(See White Lines)