Phones 4U, which is owned by London’s BC Partners and employs 5, 596 people, said on Sunday that it had been forced to seek protection from its creditors as a result of the failed contract renewal with EE and, earlier this month, Vodafone.
The decisions from both Vodafone and EE mean that the company will have no network partner come next September when the existing contracts run out, and in a statement, Phones 4U said that the decisions from both operators “have come as a complete shock”.
All of Phones 4U’s 550 stores across the country are due to close “pending a decision by the administrators on whether the business can be reopened for trading” the company said.
“Today is a very sad day for our customers and our staff,” said David Kassler, CEO at Phones 4U.
“If the mobile network operators decline to supply us, we do not have a business.”
Phones 4U’s rival, Dixon’s Carphone, saw its share prices rise 3% following the news, and Alistair Davies, analyst at Investec said that Dixon could now steal £225 million in annual revenue from Phones 4U.
This “could represent a £45 million opportunity for forecast” full-year pre-tax profits, he added.
