Carphone Warehouse breaks off telecoms unit

30 Mar 2010

Britain’s Carphone Warehouse has completed a demerger of its retail and telecoms units. According to TeleGeography’s GlobalComms Database the company first announced its intention to split the two divisions in November 2008 citing the difficult economic climate as one of the main factors, adding that the move would unlock shareholder value. It subsequently announced that it would review its corporate structure in spring 2009, and to that end in April 2009 it was confirmed that the company would split its retail and telecom businesses into two separate, fully-listed companies. The demerger had been scheduled to take place by July 2010 at the latest, and following the break up the telecoms unit will now operate under the TalkTalk banner, with the retail unit to be known as New Carphone Warehouse in the interim; once all remaining paperwork is complete the ‘New’ moniker will be dropped.

Shares in the old, combined unit ceased trading on 23 March, and at that date the company had a market capitalisation. Shares in the newly split companies began trading on 29 March. Shareholders received one share in TalkTalk for every share held in the previous combined entity, while one New Carphone share was issued for every two shares held in the old group.

As at December 2009 TalkTalk, having completed the migration of broadband customer from Tiscali UK, which it agreed to buy in May 2009, had a broadband subscriber base of 4.155 million, making it the market’s second largest player. At that date it also had a total of 2.73 million fixed line voice subscribers. The telco also provides services to business users via its Opal brand.

United Kingdom, TalkTalk