Carphone Warehouse's shares advanced Tuesday after announcing a proposal to buy out Best Buy in joint venture CPW Europe.
The company has conditionally agreed to become the sole owner of CPW Europe by purchasing Best Buy's 50% stake for a net consideration of £471m.
Chief Executive, Roger Taylor, said the proposed acquisition would bring an end to a five-year joint venture with Best Buy.
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"Carphone Warehouse and Best Buy have enjoyed a great relationship over the last five years ensuring that we shared and enjoyed many aspects of each other's business attributes," he said.
"However, following the sale of our US interest last year, we have become increasingly responsible for the day-to-day operations of CPW Europe whilst conversely Best Buy have become more focused on their wholly-owned businesses. As a result, both parties have agreed that this is a good time for us to bring the joint venture to an end, whilst ensuring that our relationship remains in place by way of our global buying alliance."
He said the transaction will simplify the company's ownership structure, streamline management decision-making and give the company control over growth opportunities across Europe.
Separately, the firm announced placing of 47m new ordinary shares of 0.1 pence each, representing about 9.99% of the existing issued ordinary share capital.
Proceeds of the placing will be used to partly fund the proposed acquisition.
RD
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