Apex Insight carries out commercial due diligence on Dixons Carphone / Sprint US JV

By Frank Proud

Dixons Carphone has announced that its Connected World Services division has entered into an agreement with Sprint Corporation which will see the Carphone / Sprint JV operate stores in the US on behalf of Sprint. If an initial 20-store pilot is successful, Dixons Carphone will invest up to $32m to obtain a 50% share in the venture as it rolls out to up to 500 stores.

Apex Insight carried out an independent commercial due diligence review of the market and prospects for the joint venture to support Dixons Carphone in making its decision to partner with Sprint.

Sprint is one of the four national mobile networks in the US. It is backed by Softbank of Japan and has a management team with a brief to pursue a strategy of growth.

The US scores well on top-level benchmarks relative to the UK and Europe: 4G adoption has been faster and usage levels are higher for voice, text and data. Carrier revenues have been growing at approaching 5% per year and EBITDA margins are significantly higher than in the UK.

The Dixons Carphone Connected World Services team has a successful track record in the US from its joint venture with Best Buy which saw it open and operate Best Buy Mobile outlets within Best Buy outlets and at standalone locations.