Cellnet is to invest up to 57m in the Dixons-owned Link chain to give the mobile phone operator a high street retail presence and allow the retailer to more than double its outlets to 200.
An initial payment of 25m, with up to 32m in cash payments, dependent on performance over the next five years, secures Cellnet a 40 per cent stake in the chain, which was established in October 1994.
The Link, which specialises in communications products from mobile phones to faxes and fixed-line telephones, made a pre-tax loss of 2.9m on turnover of 21m in the year to the end of April 1996.
The deal comes just one week after Cellnet revealed it had attracted only 12,000 new subscribers in the first three months of the year. Orange and One2One, which both have fewer total subscribers than Cellnet, recruited 109,000 and 75,000 subscribers respectively in the same period.
The Link connects to all mobile operators, except Vodafone, and will continue to do so. “We have bought a stake in a potentially lucrative business,” says a Cellnet spokesman.
Last month, Dixons joined the Shell Smart card test in Scotland. Cellnet is a founding member of the consortium.
Andrew Collinson has been hired by Cellnet as brand development manager. He was previously marketing business planning manager at Cellnet’s majority-owner, BT. He reports to brand director Tim Evans who also joined from BT.