Search Icon

More than 1,500 Phones 4U staff made redundant

Administrator to permanently close more than half of Phones 4U's stores due to "limited interest"

Phones 4U collapsed into administration after EE and Vodafone cut ties with the retailer Credit: Photo: Tony White

More than 1,500 Phones 4U staff are to be made redundant after the retailer’s administrator was unable to find a buyer for over half its stores.

PwC said last night that due to “limited interest”, 362 shops will be permanently closed, causing the loss of 1,697 jobs.

Rob Hunt, joint administrator for Phones 4U, which collapsed on September 14, said: “It is with much regret that we have today made the difficult decision to close a large number of stores.

“It is a very sad day for the staff working at those locations and our thoughts are with them.

“We will make every effort to help the affected staff, working with the Phones 4U HR team over the coming days to support employees.”

Despite the store closures, Sky News reported that Dixons Carphone is still interested in buying up to 100 Phones 4U shops.

The closures came just hours after mobile operator EE agreed to buy 58 of Phones 4U’s 720 stores for £2.5m, saving 359 jobs.

Vodafone said on Friday it has agreed to acquire 140 stores and re-employ their 887 staff.

Phones 4U collapsed into administration after EE and Vodafone cut ties with the retailer. The retailer was also saddled with heavy debts by its private equity owner, BC Partners.

PwC had been in active talks with three potential buyers of parts of the business. It is understood that BSkyB, which provided Wi-Fi service to customers of Phones 4U's virtual mobile network, Life Mobile, had held discussions with the adminstrator but it was not clear if it made a bid.

Phones 4U went under with £110m in cash and £89m in stock. It owed £125m via a revolving credit facility and £430m to senior bondholders, who are considering their legal options. Debt holders who bought £205m in unsecured Phones 4U bonds have been wiped out.

Creditors had hoped to save the chain by offering to swap some of what they are owed for equity, if supply contracts with EE and Vodafone were revived. However, Mr Hunt dashed their hopes after saying last week that there was "no realistic prospect for a debt-for-equity swap".