Best Buys 50% stake in Carphone Warehouse

LONDON and MINNEAPOLIS The Carphone Warehouse Group and Best Buy have agreed to form a new venture, in which the two companies will each own 50% of Carphone's retail business comprising all the 2,400 stores, the Web and direct businesses, the insurance operations, and its airtime reselling businesses.

The Carphone Warehouse continues to own 100% of its fixed line telecoms business in the United Kingdom, comprising TalkTalk, AOL Broadband and Opal; and its share of the Virgin Mobile France joint venture.  Best Buy continues to hold its 2.9% stake in The Carphone Warehouse.

The Carphone Warehouse plans to use the proceeds of the transaction ($2.142 billion) to repay existing debt, to invest in broadband customer growth and infrastructure, and to invest in new areas of growth presented by the transaction.

The transaction is subject to the approval of The Carphone Warehouse's shareholders.  The directors of The Carphone Warehouse have unanimously agreed to vote in favour of the resolution to approve the transaction at the extraordinary general meeting scheduled to take place by early August.