Split sees market debut of Talk Talk Telecom

CARPHONE Warehouse's TalkTalk broadband arm made its stock market debut yesterday as the company split 21 years after it was founded by Charles Dunstone.

TalkTalk Telecom – the UK's second-biggest broadband firm behind BT with more than four million customers – is valued at some 1.1 billion following the long-awaited demerger.

The split leaves Carphone Warehouse with its 50 per cent stake in Best Buy Europe – its joint venture with the US consumer electronics giant – and a 47.5 per cent stake in Virgin Mobile France.

Carphone Warehouse has a current market value of some 620 million following the shake-up.

Dunstone, who set up the business in 1989, retains a 33 per cent stake in both TalkTalk and Carphone Warehouse valued at around 550m.

The former chief executive is now chairman of both companies, with Carphone now led by former finance director Roger Taylor and TalkTalk to be run by Dido Harding, who is joining from Sainsbury's.

TalkTalk, which has about 5,000 staff, is due to give its first trading update as a separate entity on 11 May.

Carphone Warehouse sold half of its retail business to US partner Best Buy for 1.1bn in 2008.

The first store in the partnership's assault on the UK market will open in May in Thurrock, Essex – offering initiatives such as a trade-in service where customers can receive discounts when they bring in their old televisions, laptops and mobile phones.

Best Buy stores in Hedge End, Southampton, and Merry Hill in the West Midlands will both open in June, followed by Aintree, Liverpool as the group throws down the gauntlet to Currys-owner DSG International and Kesa Electricals, which owns Comet in the UK.

Earlier this month, DSG, which also runs the PC World stores, said it was speeding up its roll-out of larger stores after successful early results.

Collins Stewart analysts believe TalkTalk could attract a takeover bid.