Vodafone is set to expand its UK business with the acquisition of Cable & Wireless Worldwide (CWW).
The mobile broadband provider is reported to have offered £1.044 billion to buy out the telecoms giant - which equates to 38p per share.
As a consequence, Vodafone is set to gain access to CWW's unbundled broadband network in the UK, which is used to support a number of small service providers.
The acquisition should also help Vodafone respond to growing data demands from end-users.
John Barton, Chairman of CWW, said the offer from Vodafone will enable shareholders to crystallise a value, in cash, that represents "a significant premium" to recent trading levels.
This will avoid exposure to the risks inevitably presented by executing a medium-term improvement strategy, he stated.
Vittorio Colao, Chief Executive of Vodafone Group, said the firm is pleased to have reached agreement with the board of CWW, which has unanimously recommended the offer.
He said the deal will create a leading integrated player in the enterprise segment of the UK communications market and bring attractive cost savings to Vodafone's UK and international operations.
"We look forward to working with the management and employees of Cable & Wireless Worldwide to combine our expertise for the benefit of our customers and shareholders," Mr Colao added.