U.K.-based retailer Phones 4U continued its slow demise this week, with published reports indicating that more than 2,400 employees were set to lose their jobs with the closing of 362 retail locations. The job losses are to include nearly 1,700 employees immediately, with another 720 employees set to lose their jobs once the store closings wrap up.
“It is with much regret that we have today made the difficult decision to close a large number of stores,” Rob Hunt, the joint administrator of Phones 4U, told The Guardian. “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.”
The Phones 4U closing was initially set to impact nearly 5,600 jobs across 720 retail locations, though some of the wireless operators that offered services through the retailer have agreed to take over some of the locations. Vodafone UK announced late last week that it would take over 140 Phones 4U locations, including approximately 887 employees. Those outlets are set to be rebranded as Vodafone stores. Earlier this week, wireless operator EE had agreed to take over 58 Phones 4U locations, as well as keep the corresponding 359 employees. Those outlets will also be rebranded as EE retail locations.
In addition, more than 800 Phones 4U employees that worked at retail locations based inside of retailer Dixons Carphone will be absorbed into those operations.
Phones 4U noted earlier this month that it was forced “offline” following “the unexpected decision of EE and Vodafone to withdraw supply from Phones 4U. According to published reports, Phones 4U’s closing was a combination of poor cash management from the retailer’s ownership and a pricing squeeze from wireless carriers. One report indicated that wireless carriers were upset following a recent move by Phones 4U owner BC Partners to offer up $325 million in a bond offering and then pay itself the same amount in a one-off cash dividend. BC Partners did say that it intends to be paid “until further notice.”
Vodafone responded by stating it had offered Phones 4U new distribution terms, but that it was unable to come to an agreement.
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