Best Buy sells stake in European venture to Carphone Warehouse Richard Schulze's proposed offer could value the electronics retailer's equity at close to $9bn Best Buy has pulled the plug on its foray into Europe after the US electrical retailer sold its half of its European joint venture back to Carphone Warehouse Group for £471m. The sale brings to a close a five-year relationship between the British mobile phone group and the US company - the world's largest consumer electronics retailer by sales - which in 2008 created the 50-50 joint venture called Carphone Warehouse Europe. The joint venture operates 2,400 stores across eight European countries and trades under the Carphone Warehouse and Phone House brands. The withdrawal marks the end of a costly venture into Europe for Best Buy, which paid £1.1bn in May 2008 to expand its 3 per cent stake in Carphone Warehouse Europe to 50 per cent. Under the terms of Tuesday's deal, Minnesota-based Best Buy will receive £391m in cash and £80m worth of Carphone shares, which are subject to a 12-month lock-up restriction. "This transaction allows us to simplify our business, substantially improve our return on invested capital, and strengthen our balance sheet," said Hubert Joly, Best Buy president and chief executive. "Each international market is different and the sale of our European operations should not suggest any similar action in our other international businesses," he said. Carphone will fund £80m of the purchase through the placement of more than 47m shares at 190p each, representing 10 per cent of the phone retailer's existing share capital. Shares in the British retailer rose 15 per cent to 233.75p on the news. In late 2011, Carphone Warehouse sold its stake in the US version of its retail joint venture with Best Buy to its partner for more than $1bn - a move that Roger Taylor, Carphone Warehouse chief executive, said had prompted the group to focus on its European business, while Best Buy honed its attentions on the US market. As a result, both parties have agreed that this is a good time for us to bring the joint venture to an end, whilst ensuring that our relationship remains in place by way of our global buying alliance. For us, the transaction will simplify our ownership structure, streamline management decision-making and give us full ownership of our growth opportunities across Europe and other markets around the world. The US group said that revenues for Best Buy Europe for the 2014 financial year were expected to be about $5.5bn, while adjusted diluted earnings per share "were expected to be immaterial." Deutsche Bank and UBS acted as joint bookrunners, while Carphone Warehouse was advised by Credit Suisse. For the 12 months to March 31 2012, Carphone Warehouse Europe reported revenues of £3.3bn - down 5.5 per cent year-on-year - and pre-tax profit of £119m.