Mr Caudwell says he is considering other business projects

Doughty Hanson and Providence Equity Partners will buy Caudwell Holdings, which includes the Phones4U chain.

Mr Caudwell founded the group in 1987 and will get �1.24bn for his 85% stake when the deal is completed next month.

He put the Stoke-on-Trent-based firm up for sale last November after conducting a strategic review of his business.

The remaining 15% of the business is owned by Mr Caudwell's brother Brian and finance director Craig Bennett.

The group's fixed-line service, Caudwell Communications, was sold to Pipex in March for �40m.

"It's a fair price, but it's not a great price. The business has such a lot of further potential going forward and there is no doubt that the buyers will make a very substantial profit," Mr Caudwell said.

Rich List

Providence Equity will take control of the 350-store Phones 4U chain, a business-to-business operation and an insurance division called Lifestyle Services.

Doughty Hanson will buy Crewe-based 20:20 Logistics, the UK's largest distributor of mobile phone handsets, and Dextra Solutions, which packages and delivers mobile phone accessories.

John Caudwell bought his first mobile phone in 1987

Mr Caudwell, who was ranked 29th in the Sunday Times Rich List, originally set up his company 19 years ago after discovering he could receive a discount on the usual �1,500 price tag of a mobile phone if he became a dealer.

The firm, then called Midland Mobile Phones, took eight months to sell its first order of 26 phones.

It now sells 26 phones a minute, has 350 stores across the UK and employs more than 8,000 people across the globe.

Last year the Caudwell Group had sales of more than �2bn, with profits of about �150m.