Further shareholder returns possible at Dixons Carphone, says Oriel Securities

Oriel Securities has reiterated a 'buy' rating for Dixons Retail, saying that the announced all-share merger with Carphone Warehouse should be seen as a positive for shareholders.After months of talks the companies announced on Thursday a 'merger of equals' that would create a entity worth around £3.7bn as of Wednesday closing prices, Oriel said.The new company, to be named Dixons Carphone plc, is hoped to create a "world-class British retailer for the new digital age", offering consumer electricals, mobiles, connectivity and related services, the firms said.Oriel estimates that the enlarged group would generate £380m of earnings before interest and tax this year with a healthy net cash position in excess of £130m."At first glance, the benefits from the deal look positive, and accretive to earnings, raising the possibility of further shareholder returns, particularly as property losses and high coupon bonds unwind in the next three years," the broker said.BC