Carphone Warehouse, which has several branches in Ireland, is to acquire US media powerhouse Time Warner's AOL's Internet access business in the UK for £370 million, Europe's top mobile phone retailer said today.
AOL is one of the largest Internet service providers in Britain with around 2.1 million customers, 1.5 million of them broadband customers.
Carphone, which is funding the acquisition via an extension of existing debt facilities, said it would acquire AOL's customer base in the UK as well as the supporting management and infrastructure.
AOL will provide co-branded portal, content and other audience services and will manage the online advertising sales for Carphone Warehouse's combined broadband customer base through a revenue-sharing agreement.
The mobile retailer also said today it expects an additional £20 million in costs at its broadband business this year, as it reported 625,000 customers for the service in Britain.
Carphone, which announced its "free broadband" offer in April, said greater-than-expected demand for the service had saddled it with extra costs and it now expected start-up costs of around 70 million in the current year.
Chief executive Charles Dunstone said the group's underlying performance in the first half of the year had been ahead of its expectations.
"We expect interim headline pretax profits, before the impact of our broadband and Virgin Mobile France operations, to be up 50 per cent year-on-year," he said in a statement.
Shares in the company closed at 333-1/2 pence yesterday, giving it a market value of around £2.97 billion. The stock fell earlier this year in the wake of reports of troubles in the broadband business, but has recovered some ground since.