Dixons Retail, owner of Currys and PC World, has announced today that it is going ahead with plans to merge with Carphone Warehouse.

In a deal worth £3.8bn, Carphone Warehouse will be rebranded into Dixons Carphone. Ownership of the brand will be equally split between the two firms’ existing shareholders.

With the merger not expecting to close any branches, the Dixons firm will be expanding from its current size of about 500 Currys and PC World outlets to incorporate Carphone Warehouse’s 2,000 stores. This expansion will include stores from across Europe.

Sebastian James, chief executive of Dixons, announced the merger with details of Dixons performance for the financial year. Underlying sales are up by 3% and an expected profit of £150m - £160m.

“Dixons and Carphone are thinking ahead and are right to pursue this strategy, but it will require some deft management skills and product-partner strategies to make this a reality. Warwick Business School professor of practice Mark Skilton, who researches the internet of things, says, "Vendors are increasingly thinking this way to bring a group of products and services together in embedded connected services to consumers, but the IT standards, cyber security and other technical issues may still need to be matured together with the kind of mobile apps and cloud computing website hosting to serve the customers and sellers like Dixons and Carphone.”

Carphone Warehouse’s chairman and founder, Sir Charles Dunstone, will chair the new group with Dixons’ James as the chief executive.

Dunstone says, "We are incredibly excited about the opportunity today's news brings to our organisations, our consumers and our investors. We see the merger of these two great companies as an opportunity to bring our skills together for the consumer and create a new retailer for the digital age."

The merger is expected to save the companies £80m a year from the 2017-18 fiscal year onwards.