TalkTalk to split (from Carphone Warehouse)?

The Grande Fromage of TalkTalk and AOL owners Carphone Warehouse, Charles Dunstone has launched a “formal review of the group’s corporate structure” which could lead to the breakup of its telecoms division, which could potentially see TalkTalk becoming a fully independent ISP.

However, it is more than likely that usual suspects Sky, Vodafone, Orange, BT and the gang will be offered the chance to bid for the customer bases of both TalkTalk and AOL beforehand – TalkTalk is believed to account for some £1bn of Carphone Warehouse’s current £1.3bn valuation.

The BestBuy deal is said to be taking its toll on the group, and Dunstone is reportedly considering splitting the group in half, allowing for easier management of the retail arm of Carphone Warehouse.

“We recognise, however, that the structure of the Group may now no longer be appropriate for the optimal development of the two businesses,” said Dunstone. “The Board has therefore initiated a formal review of the Group’s corporate structure and capital requirements, which may lead to a separation of the two businesses. In this instance I would remain closely involved with both companies.”

This is a bit of an about turn for the company which, earlier this year, was thought to be the favourite to buy up the UK arm of Tiscali’s home broadband customers, a move which would have seen Carphone become the biggest ISP in the country. Now Sky are thought to be in negotiations to buy up Tiscali’s UK operations instead.

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