Sky agrees £200 million deal to buy O2’s broadband business
Sky has agreed a deal with O2's parent company, Telefónica UK, which has seen the satellite broadcaster pay an initial £180 million for O2’s consumer broadband and fixed-line telephony business.
Under the terms of the deal, which is subject to regulatory approval, if there is a successful migration of customers to Sky, Telefónica will receive an extra payment of up to £20 million.
The deal has meant that Sky will become the second-largest broadband provider, taking its customer base to around 4.7 million, ahead of Virgin Media, which had almost 4.3 million subscribers at the end of 2012. BT remains ahead of the market with around 6.5 million broadband customers.
Sky chief executive Jeremy Darroch said: “From a standing start in 2006, we have added more than 4.2 million broadband customers. The acquisition of Telefónica UK’s consumer broadband and fixed-line telephony business will help us accelerate this growth.”
Meanwhile Telefónica said it wanted to focus on its mobile phone business, having spent £555 million on a 4G licence last month.