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Distributors - Alex Yau
January 5, 2015
Mobile operator now takes full ownership of the company, with the Mainline brand to remain; MD Andrew Boden to leave the company after 23 years
EE has acquired airtime distributor Mainline Digital Communications for an undisclosed fee.
The mobile operator has held a 26 per cent share in EE-exclusive distributor Mainline since March 2001 and now takes total ownership of the company.
Mainline will operate as a wholly-owned subsidiary of EE and will continue to operate under its own brand.
“It was a no-brainer,” EE director of small business Mike Tomlinson told Mobile News. “If we’re going to try and enhance our capability in the channel, taking full ownership of Mainline and its capabilities was the obvious thing to do.”
The airtime distributor’s managing director Andrew Boden, who has been with the company for more than 23 years, will leave in six months but in the meantime will remain on a consultancy basis. He will not be replaced.
Instead, Mainline will be led by its finance and commercial director, and current board member, Stephen Chandler, along with a soon-to-be appointed sales and marketing director, who will join the company in the newly created role over the coming weeks.
In addition, EE chief financial officer Neal Milsom and EE chief marketing officer Gerry McQuade will also join the Mainline board.
Mainline’s head office in Burton-on-Trent will remain, as will the 45 staff that work there, with no redundancies made.
The firm actively trades with more than 200 dealers across the UK and as a result of this acquisition, will now forge a direct relationship with EE.
There will also be no change to EE’s relationship with fellow airtime distributor Mdee, with the mobile operator continuing to hold a 35 per cent share in the company.
In its most recent financial results for the 12 months to August 31, 2013, Mainline posted turnover of £25.458 million along with an operating profit of £384,000.
Multi-million pound investment
The mobile operator declined to reveal the value of the acquisition but said it is a part of a multi-million pound investment into the channel.
Tomlinson admitted it has taken longer than planned to address problems with correct and on-time commission payments to dealers, as well as investment in its new SAP payment system, but that the acquisition of Mainline demonstrates just how serious it is about the channel.
“We looked around to see how we could make things better,” he said. “The answer and blueprint was right within the EE family. Mainline treats partners very well, has fantastic systems in place, a good level of CRM capability and is an excellent payer of commissions.
“Quite a few things have taken longer than they should, such as reconciling commission payments to dealers and investing in our SAP system, but since the start of the year we have still invested millions of pounds into the channel, and this acquisition is part of that multi-million pound investment that we needed to make. It shows just how serious we are about the channel.”
Number one provider
McQuade added that the deal will contribute significantly to its ambition of being the number one communications provider for businesses.
“Mainline is a highly responsive, efficient and entrepreneurial distributor with excellent business practices and principles,” he said.
“By acquiring Mainline, we will be able to extend their capabilities in support of our indirect B2B sales strategy and help us achieve our goal to be the top communications provider for businesses in the UK.”
“Coming of age”
Boden labelled the acquisition as a “coming of age” for Mainline and said the acquisition demonstrate its strong commitment to the future of the channel and relationships with dealers.
“This is almost like a coming of age for us, with EE recognising the skill set, capabilities and experience that we have in the business. That is down to the people and systems we have developed over many years that are industry-leading and set us apart from our competition.
“Our stockists regard us very highly and think of us as a trustworthy partner that treats them properly and ethically. This announcement will only bolster those relationships.
“They will see that the added support of EE as the sole owner shows how serious they are about the future of the channel and the future of the relationships Mainline has with its stockists.”
