Carphone not seeking bid for TalkTalk

LONDON (Reuters) - Carphone Warehouse (CPW.L) has not received any bid interest in its TalkTalk telecoms business and will not be seeking a buyer after it separates from the group's retail arm in March, its finance director told Reuters.

"We're not out there seeking offers for the (TalkTalk) business," Roger Taylor said in a telephone interview on Friday.

Analysts have speculated that TalkTalk, Britain's second-biggest broadband provider behind BT (BT.L), might attract bids from rivals like BSkyB (BSY.L) or a mobile phone network operator like Vodafone (VOD.L) after its separate listing.

Carphone, which is also Europe's biggest mobile phone retailer, said on Friday it would list TalkTalk and its retail business, which will keep the Carphone name, on March 29.

Shareholders will receive one TalkTalk share for each Carphone share they own, and will get one new Carphone share for every two old ones.

Carphone's founder and Chief Executive Charles Dunstone will chair both businesses, while Taylor will become chief executive of the retail operation and Dido Harding, former head of convenience stores at grocer J Sainsbury (SBRY.L), will head TalkTalk.

Taylor was confident of a smooth demerger, despite analyst reports warning that some index-based funds might not be able to own new Carphone shares because of its status as a secondary stock market listing.

Less than 5 percent of Carphone's existing stock was held in index-based investments and its owners might be able to hold the new shares by simply putting them in another fund, he said.

Taylor also remained bullish about growth prospects for Carphone's retail business, which is a joint venture with U.S. electrical goods group Best Buy (BBY.N).

The venture is on track to open around three to four megastores in April, followed by a website over the summer and a further clutch of megastores later in the year, he said.

In its prospectus, Carphone cited research by Euromonitor which shows the UK consumer electronics market was worth 19 billion pounds ($31 billion) in 2009 and forecast it would deliver a compound annual growth rate of 9.3 percent from 2009 to 2013.

Taylor was relaxed about signs of an improved performance from DSG International DSGI.L, Britain's biggest consumer electricals retailer which has been achieving particularly strong results from its new, larger stores.

"What we intend to do is raise the bar quite a lot higher," he said, highlighting Best Buy's reputation for good customer service.

Taylor said the consensus among analysts was that the value attributed to TalkTalk in the group's current share price was about 120 pence, with around 80 pence attributed to Carphone.

(Editing by Sharon Lindores)

($1=.6147 Pound)