Vodafone Group is to drop Carphone Warehouse in favour of rival retailer Phones 4u to sell its mobile phone contracts in Britain, the mobile giant has announced.
The announcement knocked shares in Carphone, Europe's biggest mobile retailer, as much as 12.7 per cent lower.
A spokesman for Vodafone said the group hoped to pay lower sales commissions with the change, expected to take effect by the end of November. "Commissions will come back down to where they were last year," he said.
Intense competition among mobile operators in Britain, which has more mobile phones than people, has been to the benefit of mobile retailers, enabling them to earn better commission for each customer they sign up on behalf of networks.
Vodafone said the deal would make Phones 4u, which was acquired by private equity group Providence from owner James Caudwell last August, the exclusive third party retailer for Vodafone's contract customers.