The Carphone Warehouse Group PLC (LSE: CPW) said its joint venture with Richard Branson’s Virgin Group, Virgin Mobile France, is to acquire French mobile operator Tele2 Mobile for €56m.
The Carphone Warehouse owns 48.5% of Virgin Mobile France. Following the transaction Virgin Mobile France will have more than 1.6 million customers, of which 60% are contract customers. The deal will consolidate its position as France's largest mobile virtual network operator (MVNO) and the fourth largest mobile operator overall.
The Tele2 France deal marks a major step forward in Virgin Mobile's growth plans in France and will help it progress towards its target of being profitable during 2010. As Virgin Mobile will be able to reduce its operating costs by strengthening its relationship with the network operators, this will also help cut costs and drive major economies of scale.
The acquisition is conditional on the approval of the French anti-trust authorities.
The Carphone Warehouse group is made up of the Carphone Warehouse and TalkTalk Group. Carphone Warehouse is the retail and distribution business, its an independent retailer of mobile phones and services with over 2,400 stores in 9 countries.
TalkTalk is the group’s fixed line business, its currently UK’s third largest broadband provider with over 3.9m fixed line customers comprising 2.8m broadband and 1.1m voice-only and narrowband customers. The Carphone Warehouse also has jointly owned operations, including Virgin Mobile France and the Best Buy Europe, which offer retail handsets, phone insurance and MVNOs in Europe.