Phones 4U goes into Administration after Vodafone and EE cut ties
Phones 4u, a major independent mobile phone retailer in the United Kingdom, has gone into administration after its last remaining mobile operator partners, EE and Vodafone, announced cuts in ties with the retailer on Sunday night.
The retailer is owned by private equity firm BC Partners. It has 720 outlets, including 550 standalone stores and employs 5,596 people. The management will brief the staff in stores and at head office on Monday morning. BC Partners said it is "intended that employees will continue to be paid until further notice".
Phones 4U sells a range of phones and contracts on various networks. The chain needs those networks to continue supplying phones and deals. But the last remaining major networks, EE and Vodafone, have now pulled themselves out of their agreements.
EE's decision, which was announced on Friday, came after a decision a fortnight ago by Vodafone to stop selling through Phones4u.
David Kassler, Phones 4u Chief Executive Officer, said, "If the mobile network operators decline to supply us, we do not have a business. Today is a very sad day for our customers and staff".
Sefano Curzio, a spokesman for London-based BC Partners said that Vodafone, which will end its contract in February, has acted exactly the opposite to what they had consistently indicated to the management of Phones 4u over more than six months.
EE's decision to end the contract on September 30, 2015, last week had come as a complete shock to the business. This leaves the board with no alternative but to seek the administrator's protection in the interests of all its stakeholders.
The retailer is now seeking to appoint PwC as administrators at the firm, which has a turnover of £1bn and "significant cash in the bank". Its stores will remain closed while administrators attempt to build a rescue plan for the business.