Dixons Retail/Carphone Warehouse merger 'will happen'

Deal is a matter of when, not if, claims source as Carphone revenues rise
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UK tech retail giants Dixons Retail and Carphone Warehouse WILL merge, PCR understands.

A source close to the situation has told PCR the deal is 'as good as complete' - and is a matter of when it will be announced, not if. 

The source added that Dixons Retail - which owns PC World and Currys - wants Phones 4U out of its stores and Carphone Warehouse involved going forwards.

There are currently Phones 4U 'store-in-stores' in more than 150 Currys/PC World outlets across the UK.

The news comes as Carphone Warehouse announced revenues rose 5.3 per cent during the 52 weeks ending March 29th 2014, with Q4 like-for-like revenues up 2.3 per cent.

Carphone Warehouse refused to talk about the possible merger during a conference call this morning.

"We'll update the market in due course," said Carphone Warehouse CEO Andrew Harrison, as reported by The Irish Times.

Dixons Retail and Carphone Warehouse announced in February they are in preliminary discussions over a possible merger. They were granted a merger deadline extension and are now expected to announce whether they will merge or not by May 19th at 5pm.

Adam Simon, Global MD for Retail Business Development at Context, said: "Rival retailers will find it harder to compete - Phones4U will not see the renewal of its contract with Dixons in 120 stores, and will face tougher pressure on the High Street from a combined Dixons/CPW.”

Read more about how the potential merger could affect the PC/tech industry in our analysis piece.

Dixons Retail didn't respond to PCR's requests for a comment.

UPDATE (May 16th 2014):Dixons Retail and Carphone Warehouse confirm they will merge in a £3.8 billion deal.

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