![phones 4u phones 4u](https://m.media-amazon.com/images/I/51Bscu9x8ZL._SY445_.jpg)
In effect, because Phones 4U had become little more than an EE shop that charges commission. However EE eventually walked out too, cancelling a contract that still had a year to run thus making Phone 4U a retailer with nothing to sell.ĮE claim that they left Phones 4U because they had become a single operator shop and were no longer able to help compare prices between different operators. This left Phones 4U with a single major supplier. Vodafone claim that the offer they received was ‘out of line with industry norms’, which indicates that Phones 4U did not appreciate the change in market conditions when they made their offer.
![phones 4u phones 4u](https://mylichfield.co.uk/content/uploads/images/2018/07/large_phones_4_u.jpg)
Market conditions had been changing and Phones 4U now had a lot less leverage over Vodafone. Through investing in their own high street stores, Vodafone had become less reliant on third party resellers. Vodafone rejected Phones 4U’s offer in July and didn’t return to the negotiating table.
![phones 4u phones 4u](https://thumbs.dreamstime.com/z/phones-u-mobile-phone-shop-exterior-store-hastings-east-sussex-england-april-founded-all-uk-outlets-closed-53227946.jpg)
By the time Phones 4U made an offer, it was obvious that the proposed Vodafone-EE takeover could not go ahead. Vodafone gave a talk entitled ‘Phones 4U- Partner of Choice’ and it’s claimed that a deal was already informally agreed. Parallel talks were taking place between Vodafone and Phones 4U regarding an extension of their contract. In fact, it’s been claimed that Vodafone were planning to take a 100% share should EE have pulled out. The relationship had been so beneficial that, two months ago, Vodafone and EE were in talks to buy Phones 4U in a deal that would give both companies a 50% share. Phones 4U accounted for 10% of EE’s sales, and a significant amount of Vodafone’s. Vodafone and EE had done well from their relationship with Phones 4U. In fact, it’s transpired that they were also in talks to sell the company. The company was profitable – incredibly so having made over £100million profit in 2013 – and they were in talks with their major clients to extend their contracts. Things were going so well a few months ago. It has been the worst month imaginable for the company, rapidly shifting from being a profitable company whose future seemed secure, to a retailer with nothing to sell. Phones 4U has been forced into bankruptcy.