Administrators confirm huge job losses as EE, Vodafone and Dixons Carphone take on some stores and employees
Almost 1,7000 people will lose their jobs after administrators confirmed that 362 Phones 4U stores are to close. The high-street retailer collapsed last week when it failed to reach agreements with mobile phone networks to sell their services.
EE and Vodafone, both of whom pulled out of deals to sell their services through Phones 4U, have agreed to take on 58 and 140 stores respectively. Dixons Carphone, which incorporates Currys PC World and Carphone Warehouse has confirmed it will hire 800 people who worked in Phones 4U concessions in its stores.
Administrators PwC said that 720 staff were being retained in the “short team” to help shut down the remaining Phones 4U stores.
“It is with much regret that we have today made the difficult decision to close a large number of stores,” PwC said. When it entered administration last week Phones 4U had 550 stores and employed 5,600 people.
The retailer was left with no product to sell after O2, then Vodafone and finally EE stopped doing business with it. Last year it reported profits of £105m but its business model was entirely reliant on major mobile phone networks letting it sell their services.
Phones 4U founder John Caudwell last week blamed the mobile phone networks for destroying Phones 4U. Speaking to the BBC he said its closure was an “unprecedented assassination” from the “ruthless” mobile phone networks.
Both EE and Vodafone rejected these claims, with the latter saying that Phones 4U had acted inappropriately during contract negotiations. Others have pointed out that Phones 4U’s demise was in part caused the the private equity firm that owned it. The firm had loaded £200m of debt onto the high-street retailer.
Anyone concerned about a purchase or contract they had with Phones 4U should read our Q&A on what to do next.