German exit is part of the firms European business review. Dixons Carphone insists it remains committed to the Phone House brand
Dixons Carphone has agreed to sell Phone House Deutschland to German MVNO Drillisch for a combination of shares and unspecified future cash flow.
The retail giant, which operates the Phone House brand in six countries, said the sale followed a period of restructuring in which it had closed its wholesale operations in Germany, and will allow it to focus on other markets.
Details on Phone House Germany performance were not given, nor feature in the firms 2014 financial performance report.
A spokesperson for Dixons Carphone told Mobile News the decision is part of European review of the business, following the £3.74 billion merger deal between Dixons and Carphone Warehouse last August.
No further announcement on further potential cuts are imminent.
Dixons Carphone has 121 owned Phone House stores, of which 34 operate as part of its franchise scheme. There are around 1,162 Phone House branded stores across Europe. These include 91 in Sweden (nine of which are franchise), 145 in Netherlands (68 franchise), 5356 in Spain (178 franchise) and 157 in Portugal (thee franchise).
It has more than 1,298 stores in the UK (including around 800 Carphone Warehouse branded) and nearly 3,000 globally.
Drillisch said it will give Dixons Carphone new shares equal to three per cent of its stock when the deal closes (expected at the end of May), along with an unspecified amount of future cashflows from the Phone House.
Drillisch is currently valued at around €2.1 billion according to the stock market, which would put the value of the shares at around €60 million.
Dixons Carphone Group chief executive Sebastian James said: “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. At the same time, this transaction enables Drillisch to broaden its horizons into wholesale connection and dealer operations.
“We have also agreed a long-term service contract, for the provision of insurance, with scope to expand this into further services in future, through our Connected World Services division. We believe that this is the start of a strong, healthy and growing business together and I could not be more pleased to be working with this excellent team.”