Carphone Warehouse Founder Resigns After Using Shares to Secure Personal Loans

David Ross, one of the two co-founders of the UK based mobile phone retailing giant, Carphone Warehouse (CPW) has resigned with immediate effect, after it was revealed that he had used his shares in the firm as collateral against personal loans.

The company issued a statement this morning, noting that between 2006 and 2008 and as part of a package of security comprising other assets of substantial value, Ross had pledged 136.4 million ordinary shares (worth around US$191 million) in the Company against personal loans. He currently owns 177 million shares - representing about 20% of the company.

London stock market rules require that a company director notifies the exchange if they use their shareholdings as collateral against any other loans or liabilities.

David Ross has also notified the Company that none of these loans is currently in default and that he has no current intention to sell any of his shares in the Company. In addition, he has given an undertaking to the Board to facilitate an orderly market, where possible, for any potential future disposal of shares in the Company.

The company has not commented on what sort of loans have been secured against the shares.

Posted to the site on 8th December 2008