Last week, the news that Phones4u had been forced into administration created shockwaves and left thousands of employees fearing for their jobs.
Fortunately, it has now emerged that a number of jobs will be saved thanks to telecommunications giant EE, which is currently on the brink of signing a deal to acquire a portion of the stricken chain’s shop portfolio.
EE has agreed to take on 58 stores from Phones4u, with the deal costing the mobile network a total of £2.5 million. This transaction includes the leasehold properties along with their fixtures, fittings and various associated contractual rights and obligations but will not, administrators confirmed, include store inventories which will be recovered separately.
This news will be welcomed by employees of Phones4u, as 359 staff members are due to be transferred to EE with immediate effect. They will begin the process of rebranding the 58 stores to EE, with early forecasts indicating that the vast majority of stores will be re-opened in the next week or so.
PwC partner and joint administrator for Phones4U, Rob Hunt, confirmed the successful end of negotiations at lunchtime today.
He said; “We are absolutely delighted to have completed this further disposal of 58 Phones4u stores, which will both recover value for secured creditors and save 359 jobs.
“As with the Vodafone transaction, we consider that this represents the best potential outcome for creditors in the circumstances, although it remains subject to the approval of the UK courts.”
Although EE’s acquisition of the 58 Phones4u stores is significant, it fails to match key rival Vodafone which last week agreed to take on 140 of the stores. This move saved 887 jobs, while Dixons Carphone’s decision to offer permanent positions to staff running concessions within their stores saved a further 800 staff members from the job centre.
In total, 5,596 members of staff have been affected by the collapse of Phones4U: so far, 2,046 have been re-employed and 628 have had their redundancies confirmed. The brunt of the collapse has so far been centred around the company’s head office in Newcastle-under-Lyme, where two thirds of the 1028 staff have already been made redundant as a means of streamlining the administrative process.
Although many Phones4U employees have, one way or the other, been given confirmation regarding their employment status, there are still a further 2,922 staff members around the country still very much up in the air at the present moment. Unfortunately, economists are predicting that job losses could run into the thousands unless further buyers can be found in the near future.
Administrators at PwC are currently in talks with Dixons Carphone and a number of international parties keen to enter the competitive UK market with a view to selling off a further portion of the stores. Hopefully, these talks will prove successful providing the high street, along with several hundred employees, with a more positive outlook.
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