Carphone Warehouse to take over Tiscali UK
In a move which has been on the cards for some time it has been revealed that Carphone Warehouse has reached an agreement with Tiscali regarding the Tiscali UK broadband operation which has been up for sale for some time. Carphone Warehouse was one of a number of parties initially interested in the operation before the company hit the rocks and the shares were suspended pending a debt restructuring.
The initial sale price, prior to suspension of Tiscali shares, was in the region of £500 million although a figure of £236 million has now been agreed. This will ratchet up Carphone Warehouse's AOL broadband operation and bring in a further 1.45 million customers. When you add in existing customers for AOL this brings the cumulative customer number to 4.25 million making the operation the largest residential broadband provider in the UK. At a time when the broadband sector is being positioned for the future, with mobile broadband very prominent, this could turn out to be a very well timed acquisition for Carphone Warehouse.
The deal is expected to go through in June this year subject to clearance from the European and UK regulators. As we suggested in one of the earlier post, this move could prompt a significant consolidation of the UK broadband sector.
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