As you may have read yesterday, Phones 4u have shut up shop this morning with the firm calling in the administrators. As part of the announcement, Phones 4u owners BC partners attacked the networks, particularly Vodafone for not giving them enough time to sort out alternative arrangements and going against what they had previously promised, with Stefano Quadrio Curzio, from BC Partners saying:
Vodafone has acted in exactly the opposite way to what they had 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.
John Cauldwell, the founder of Phones 4u who sold it in 2006, has also laid into the networks. He calls them “ruthless” and blames them and the government for killing the business.
On the other side of the fence, Vodafone have released a statement saying they are sad that the business has gone into administration and the impact it will have on employees. They say that they were left with no choice when it became clear that the alternative strategies Phones 4u had to cope with contract ending didn’t exist. Vodafone strongly refute any allegations they have acted inappropriately at any stage in the negotiation saying Phones 4u were offered “repeated opportunities to propose competitive distribution terms to enable us to conclude a new agreement”.
With Vodafone recently agreeing a new long term deal with the newly formed Dixons Carphone, it seems as if there is a lot more to this story.
You can read the full statement on the link below or in the press release box.
Source: Vodafone statement
“We are saddened to read that Phones4U have gone into administration and the impact that will have on their employees. However, we strongly reject any suggestion that we behaved inappropriately at any stage during our negotiations with Phones4U. The outcome was the result of a transparent negotiation over many months. Phones4U was offered repeated opportunities to propose competitive distribution terms to enable us to conclude a new agreement, but was unable to do so on terms which were commercially viable for Vodafone in the current UK market conditions.
We were told by the Phones4U management team that they had little commercial flexibility due to their debt repayment obligations, but that they had a number of alternative strategies in place if we couldn’t reach an agreement with them. So when we terminated our contract earlier this month, we made it clear that we would honour our existing contract, which runs until February 2015, to give them sufficient time to finalise one of those alternative strategies. It is now clear based on the events that have transpired that there were no viable alternative plans in place.”