Sky has announced that it has struck a £200 million (approximately $300 million) deal to buy Telefónica’s broadband business in a move that sees it become the UK’s second largest broadband Internet provider. The deal comes hot on the heels of US cable giant Liberty Global buying Virgin Media for $23.3 billion last month.

The Telefónica-owned O2 business has more than 500,000 customers, who will transition over to the new company as part of the deal. That addition will increase Sky’s customer base to 4.7 million broadband users in the country. That takes it beyond Virgin Media — and its 4.5 million customers — but BT continues to lead the market with 6.6 million subscribers.

In addition to the O2 broadband-fixed telecom business, Sky will also get its hands on Telefónica’s ADSL service BE.

Jeremy Darroch, Sky’s Chief Executive, believes that the deal enables the company push on and “accelerate its growth”.

“Sky has been the UK’s fastest-growing broadband and telephony provider since we entered the market six years ago. From a standing start in 2006, we have added more than 4.2 million broadband customers,” Darroch said in a statement.

Ronan Dunne, Chief Executive of Telefónica UK, said that the deal is “the best way of helping our customers get the highest quality home broadband experience from a leading organisation in the market.”

The deal has been agreed with an upfront payment of £180 million ($273 million), and a further £20 million ($30 million) will be paid when the migration and transaction has been concluded. Subject to regulatory clearance, the acquisition is estimated to go through next month.

Headline image via BEN STANSALL/Getty Images