Carphone plans to split

MOBILE phone retailer Carphone Warehouse has confirmed plans to split into two businesses.

The group said today it could deliver more value to shareholders by separating its retail arm from its Warrington-based broadband and fixed line business, Talk Talk.

The decision to create two separately-listed companies comes after a review of the business. In a trading statement the group said the board was still working out the best way to split the group’s debt facilities.

Chief executive Charles Dunstone would become chairman of both companies.

He said: “We believe shareholder value will be best served by a demerger of the two operating businesses to create two separately-listed companies.

“However, the timing of any demerger will depend on the cost and reallocation of the group’s credit facilities. The operational separation of the two businesses has already effectively been achieved.”

Meanwhile, Carphone Warehouse said full-year earnings were set to be in line with expectations. In the first three months of 2009 Talk Talk, which employs 1,200 staff in Warrington, added 74,000 broadband customers, taking its total to 2.8 million.

Mr Dunstone added: “The macro environment will undoubtedly present challenges in the year ahead but at this stage we are not seeing it deteriorate further.
 
“We are well funded, and have clear and simple strategies for our two businesses which balance growth with tight operational efficiency and cash generation.”