MINNEAPOLIS (AP) — Consumer electronics chain Best Buy Co. Inc. is establishing a foothold in the European market with a $2.1 billion investment in the continent’s largest cell-phone retailer, allowing the American company to roll out its trademark big box stores in Europe, the companies said yesterday.
The London-based Carphone Warehouse Group PLC will put its 2,400 Carphone Warehouse and Phone House stores in Europe into the new joint venture.
In a conference call with analysts, the companies said they have been speaking for four years and have collaborated for two, developing the Best Buy Mobile concept for Best Buy stores in the U.S., and bringing Best Buy’s Geek Squad, a 24-hour computer support task force, to Europe.
“We are partnering with an incredibly powerful and incredibly successful organization,” said Charles Dunstone, chief executive of the Carphone Warehouse.
Executives from both companies declined to say how many Best Buy stores will open in Europe, or in which markets, because they didn’t want to tip off the competition. However, they did say the stores will come in a range of sizes and will start opening next year.
Brad Anderson, chief executive officer of Best Buy, based in Richfield, Minn., said they will maintain Best Buy’s reputation for aggressive price competition.
Carphone Warehouse’s current European retail management team initially will remain in place, supplemented by additional personnel from Best Buy as the joint venture develops, the companies said.
RBC Capital markets analyst Scot Ciccarelli wrote the deal offers Best Buy “an intelligent and low-risk strategy to enter the European market,” rather than starting from scratch.
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