Creditors have put pressure on mobile operators to back a bid to rescue the retailer. Phones 4U are offering bondholders to swap some of what they are owed for equity if supply contracts can be revived with Vodafone and EE.
EE and Vodafone who recently informed Phones 4U they were not planning on renewing their supply contracts, had been preparing to bid for the most successful stores in piecemeal sell-off the 550-store chain.
The creditors hold around £430m in senior bonds issued by the failing retailer face the risk of being wiped out if the brand is put into liquidation this week. The debt for equity swap could potentially save 5,600 jobs if previous competitors EE and Vodafone and willing to cooperate.
The public offer was announced on Wednesday night at the eleventh hour for Phones 4U following their collapse on Sunday night. The offer would give creditors a chance to recoup more of what they are owed if Phones4U regains their supply contracts. Lawyers of the bondholders declared they were willing to wipe off a significant portion of the debt in a bid to save the retailer if all other parties are prepared to negotiate new supply contracts. Some holders of the senior bonds are already in talks over the issue.
Separately earlier this week, Dixons Carphone which hosted 160 Phones 4U concessions in PC World and Currys store was said to have agreed on employing their 800 staff.
If the rescue plan is proved successful and a positive engagement is out in place with Vodafone and EE, many jobs would be saves and maximise the returns to creditors and stakeholders.
IN OTHER NEWS:
French ruling calls for cheaper Nespresso capsules
A new French ruling for Nespresso to share information about their machines with rival’s means there will be cheaper alternatives to the Nespresso pods. Nespresso not only agreed to comply with the French ruling but has decided to carry it out throughout the rest of the world.
Nespresso is Britain’s most popular home coffee making system and costs an average of 30p to produce one cup. A household drinking three cups a day would be paying around £330 a year on Nespresso capsules.
Supermarket chain Tesco, will be selling two different options for Nespresso machines. London-based Cafepod charges £2.75 for ten pods and Carte Noire offers ten pods for £2.79. Cafepod has 4 flavour options whereas Care Noire has 2. Waitrose will also stock Cafepod but will supply 5 different flavours to their customers. Popular online destination Amazon will be selling Caffesso pods that have 6 variations of flavours and are priced at £16.49 for 60 capsules, working out at 27p per pod. The cheapest supplier will be German discount chain Lidl which will stock Bellarom in 3 flavours for 18p each. These are all available to British buyers right now.
In comparison to Amazon offering six flavours, Nespresso has a range of 22. They are categorised into Espresso, Decaffeinated, Intenenso, Pure Origin, Lungo and Variations. Nespresso also offer limited edition capsules that are one off flavours in patterned packaging. Nespresso coffe and accessories are mainly available online and in upmarket London stores offering their customers an exclusive shopping experience.
One of the aspects that the French authorities criticised was the customer warranty of Nespresso which originally encouraged Customers to use only Nespresso branded capsules however the wording is now set to change. This will reassure Nespresso users that as long as they meet the terms of the warranty, it does not matter whose capsules they choose to use.
Nespresso have carefully constructed a brand value around their pods. Customers who join their ‘Nespresso club’ receive discounts and special offers. Being exclusive to online and high end stores gives them an upmarket appeal and authentic quality. You cannot deny the relation between quality and pri