Phones 4u enters administration threatening almost 6,000 jobs

15 Sep 2014

The Phones 4u store in Briggate, Leeds. Image via Wikimedia Commons

Just under 6,000 employees at UK mobile phone retailer Phones 4u may lose their jobs after the company entered administration Sunday night with little to no warning. All stores are now closed.

However, the decision comes after a series of blows to the company who in the space of a year had seen many of the country’s biggest mobile phone networks pull their phones and contracts from the store, the latest of which being EE whose withdrawal could have effectively ended the business.

According to The Guardian, Vodafone also withdrew its range of phones two weeks ago, while 02 and Three also detached itself from the retailer earlier this year.

At the height of the company’s success in 2006, Phones 4u was one of the country’s largest providers of mobile phones reportedly selling 26 phones every minute with sales generation of over stg£2.25bn.

Vodafone criticised

Now however, its 550 stores have a grand debt total of stg£635m (€798m) and its owners, BC Partners, have now called in PricewaterhouseCoopers to oversee the administration process who will now decide whether to re-open the stores.

One of BC Partner’s executives, Stefano Quadrio Curzio, has criticised Vodafone in particular who he claims had total disregard for their partner’s interests: “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.”

Customers who had placed orders with the chain have been told that they will be issued full refunds for any phones they may have recently ordered, while a final decision on the future of the Phones 4u stores will be made later today (Monday).

Colm Gorey was a senior journalist with Silicon Republic