Carphone Warehouse has acquired internet service provider Tiscali UK for £236m, a marked fall from the £600m price its Italian parent company had hoped to earn from a sale.
The deal will see Tiscali come under Carphone Warehouse’s TalkTalk operations to make the company the UK’s largest residential broadband provider.
The Tiscali brand will be phased out and is likely only to remain for email addresses.
The announcement follows speculation last month that Tiscali and Carphone Warehouse had recommenced talks after failing to broker a deal last year
Tiscali faces debts of around £453m and it had originally hoped to raise an estimated £600m from the sale of the ailing UK business.
Other companies that are thought to have been involved in acquisition discussions with Tiscali include Vodafone, BSkyB, BT, Swisscom and Italian mobile network Wind.
TalkTalk has more than 2.8 million broadband customers. The acquisition will take Carphone Warehouse combined base to 4.25 million. Tiscali UK is part of Italian-headquartered company Tiscali S.p.A.
The deal is subject to European Union competition authority clearance, expected to be completed by the end of June.