Carphone Warehouse acquire AOL UK

Carphone Warehouse has bought AOL Internet access business in the UK from Time Warner for �370 million.

The acquisition of the AOL's access business will give Carphone Warehouse an enlarged broadband customer base of approximately 2 million customers, making it the third largest broadband provider in the UK.

Carphone Warehouse expect that over time, the additional scale is likely to create significant operating efficiencies in relation to network infrastructure and marketing costs.

Under the agreement, Carphone Warehouse will acquire AOL's Internet access customer base in the UK as well as the supporting management and infrastructure. For its part, 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.

AOL is one of the largest Internet service providers in the UK, with approximately 2.1 million ISP customers.

Commenting on the acquisition, Charles Dunstone, CEO of Carphone Warehouse, said: "The acquisition of AOL's UK Internet access business is transformational for our broadband business. This deal gives us significant scale to complement the rapid organic growth of our free broadband proposition. In addition, the joint development of AOL's already successful audience platform will bring us new advertising and content revenues in a proven and low risk manner."

On completion, it is anticipated that this will comprise 1.5 million broadband customers and 600,000 million dial-up customers.

Completion of the deal is subject to EU competition authority clearance and is expected to take place by 31 December 2006.

(SP/CD)