Mobile fashion: Fox will be eager to connect mobile and will enter the cellular field – the capital market

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Has signed a partnership agreement with Hot Mobile, for the establishment of the red store chain that will deal with the marketing of mobile devices, tablets, communication products, multimedia and related accessories. Hot will hold 51% of the network, while Fox will hold 49% and is expected to invest about NIS 22 million in the next three years.

The network will sell products from the leading media companies Apple and Samsung, and will market Hot’s cellular communication services. In addition, an online commerce site will be established under the brand, and the chain will launch products that will be branded under the chain’s private label (red) and will provide maintenance and warranty services to customers.

Liran Lublin, Director of the IBI Research Department, refers to the partnership agreement: “The field of selling end equipment is a very competitive field, on every main street corner there are stores that sell mobile products. The competition is aggressive and over the years we have seen a decrease in the gross profit of this field. Also, it is important to remember that HOT sells end equipment today. It’s not a significant area for it as a communications group. Hot Mobile’s alliance with Fox is an attempt to leverage Fox’s proven marketing capabilities, and the broad branch deployment that Fox will bring with it. Bottom line: This is a competitive field where the profitability rate is not particularly high. If it succeeds in achieving a large sales volume, it can become profitable. ”

The partnership is expected to establish about 30 stores throughout the country during its first 3 years of operation, with the opening of the first store and the launch of the e-commerce site planned for the third quarter of 2021. In addition, after two years, the parties will consider expanding the partnership to other countries. Also, the partnership board will appoint 5 directors, with 3 directors appointed by HOT and 2 directors appointed by FOX.