Thatcham: Online mobile phone retailer sold to European company for £32.5m
AO World plc, a leading European online electrical retailer, has conditionally agreed to acquire Mobile Phones Direct for a cash-free, debt-free enterprise value of £32.5 million.
MPD is a leading online-only retailer of mobile phones in the UK, based in Thatcham. MPD operates through two online brands, Mobile Phones Direct and Smart Phone Company.
MPD's websites had approximately 13.6 million visitors in 2017, up from approximately 11.6m in 2016. MPD generated revenues of £121.7m and EBITDA of £5.5m in the year ended March 31, 2018. MPD has an experienced senior management team, large customer base and strategic relationships with key mobile network operators and mobile phone distributors in the UK.
AO said the acquisition 'will significantly increase the scale and sophistication of AO's mobile proposition', which is currently limited to the sale of handsets only (without airtime or associated services). The combination of breadth of product and services across the two businesses presents a significantly improved offering for the combined customer base.
The acquisition is a significant step in AO's strategy of developing existing categories and services, and adding new complementary categories to its offering for the benefit of customers. It also provides access to a large and important market which is adjacent to AO's current electricals offering and is well positioned to benefit from continued online migration.
The deal is expected to complete prior to March 31, 2019.
KPMG in Reading advised the MPD shareholders across corporate finance (led by Sami Fairris), legal (led by Emma Gibson) and tax (led by David Furness).
