Mergers of equals are rather out of fashion at the moment following the Omnicom/Publicis fiasco but that hasn’t stopped Dixons and Carphone Warehouse tying the knot (as we forecast on Monday).
The £3.7bn merger looks a reasonable fit on the face of it although whether new CEO Sebastian James’ predictions of a future consisting of a connected ‘internet of things’ comes to pass is anyone’s guess. James (left) comes from Dixons.
The reality seems to be that Dixons needs to get more people into its big stores and attracting mobile customers is the obvious way to do it. Dixons currently has a deal with Phones4U.
We now wait to see how the combined company organises its advertising arrangements. Dixons has recently appointed AMV/BBDO to handle its three brands – Dixons, Currys and PC World – while Carphone has used CHI & Partners since its foundation.
New Dixons Carphone chairman Charles Dunstone, who owns a £400m stake in the business, can be expected to fight Johnny Hornby’s corner although there will, doubtless, be pressure to move all the business into one agency.
It will also be interesting to see what the new company is actually called once the merger goes through. ‘Carphone’ is a term that hasn’t been used since the brick-carrying days of the 1990s although it hasn’t done Dunstone and co. any harm. PC World is also a bit old hat.
There could be a rebranding bonanza in there for some lucky design agency.