Satellite broadcaster Sky is set to become the UK’s second-largest broadband provider after agreeing to pay up to £200 million for O2’s fixed-line telephony business.
The firm will pay O2 parent company Telefonica UK an initial £180m for the operation, which has more than 500,000 customers, plus a further payment of up to £20m depending on the successful completion of the deal, which is subject to regulatory approval.
Sky chief executive Jeremy Darroch said: “Sky has been the UK’s fastest-growing broadband and telephony provider since we entered the market six years ago.
“From a standing start in 2006, we have added more than 4.2 million broadband customers. The acquisition of Telefonica UK’s consumer broadband and fixed-line telephony business will help us accelerate this growth.”
Ronan Dunne, chief executive of Telefonica UK, said: “As we focus on delivering best-in-class mobile connectivity, including next generation 4G services, we believe this agreement is the best way of helping our customers get the highest-quality home broadband experience from a leading organisation in the market.”