Sky buys O2 broadband

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Sky is to become the UK’s second-largest broadband provider after agreeing a deal to buy rival O2’s half a million customer accounts.

The satellite broadcaster, which has built a business with 4.2 million broadband customers since 2006, will pay O2 owner Telefonica £180m for the O2 and BE consumer broadband and home phone businesses.

The deal is due to be completed in April and will close the gap on market leader BT, as well as place Sky ahead of Virgin Media and TalkTalk.

Sky said O2 and BE’s broadband customers will be switched to its all-fibre network. O2, which has more than 23 million customers in the UK, said the deal would enable it to focus on the roll-out of next-generation 4G services.