Thousands of Jobs at risk following shock Phones 4u Administration

Posted on 15 September, 2014 by Kirsten Kennedy

Thousands of jobs have been put at risk following the shock announcement that Phones 4u has been forced into administration.


At present, the firm controls 550 stores in the UK, all of which closed with immediate effect upon the announcement. However, Phones 4u have asked staff to report to their workplace as normal where further information will be provided, and also confirmed that all employees would “continue to be paid until further notice.”

Owner BC Partners, a private equity firm, indicated that the decision to appoint administrators came as a direct result of both Vodafone and EE deciding to terminate their professional relationships with the chain this month.

Managing partner and investment professional at BC Partners, Stefano Quadrio Curzio, said; “Vodafone has acted in exactly the opposite way to what they have consistently indicated to the management of Phones 4u over more than six months.

“Their behaviour appears to have been designed to inflict the maximum damage to their partner of 15 years, giving Phones 4u no time to develop commercial alternatives.

“The company is in a healthy state and both EE and Vodafone had, until very recently, consistently indicated that they saw Phones 4u as a long term strategic partner.”

Vodafone, EE and O2 all control around 500 stores in the UK, meaning that the collapse of Phones 4u will almost certainly work in their favour as competition will be decreased significantly. As Professor Andre Spicer of the Cass Business School points out, this will prove to be another way of taking over “more of the supply chain so they can reap a greater percentage of the profit created.”

One of the areas in which the chain’s administration will be felt most keenly is in North Staffordshire, where hundreds of workers were told the news at the company’s Newcastle-under-Lyme headquarters, Osprey House, this morning.

Chief executive of Phones 4u, David Kassler, expressed his disappointment, saying; “If the mobile network operators decline to supply us, we do not have a business.

“A good company making profits of over £100 million, employing thousands of decent people, has been forced into administration.

“The great service we have provided should have guaranteed a strong future, but unfortunately our network partners have decided otherwise – the ultimate result will be less competition, less choice and higher prices for mobile customers in the UK.”

Administrators at PwC are expected to assess the situation before revealing how many, if any at all, of the chain’s stores will be able to continue to operate in the short term.

The Phones 4u website is currently offline with a statement on behalf “the heartbroken Phones4u team” apologising to customers and promising an update as soon as possible.

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