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Carphone Warehouse, Europe’s biggest mobile phone retailer, has more than doubled its residential telephone customer base with two acquisitions that will make it the UK’s third-biggest provider of fixed-line telephony behind BT and NTL.

Carphone has agreed to buy Onetel from energy company Centrica for £132m ($233m) in cash, and to buy Tele2’s UK and Irish businesses for £8.5m.

The retailer already has more than 1m customers for its TalkTalk business, which sells fixed-line telephone services based on a BT wholesale access product. It will gain another 1.4m customers from OneTel and 224,000 customers from Tele2.

The acquisitions were viewed as a good deal for Carphone Warehouse and the company’s share price rose more than 6 per cent after the announcement.

Centrica confirmed in September it planned to sell Onetel in order to focus on its core business, but its estimates of a £350m to £400m price tag looked optimistic when it attracted a bid of little more than £100m.

Now it will effectively receive £94.9m for the Onetel business alone, with another £37.1m of the price related to agreements that Centrica will recruit its British Gas customers for Carphone, which Carphone described as a “fundamental part of the transaction”. However, Centrica will receive up to an additional £22.2m over the next three years if customer recruitment targets are reached.

Freddie George, an analyst at Williams de Broe, said Carphone Warehouse was “lucky to be the only real buyer for these sorts of assets”. There would be cost savings from marketing synergies and from moving Onetel’s business customers onto Carphone Warehouse’ own network, Opal, he said.

Carphone Warehouse said the Onetel acquisition “propels us clearly towards that position and gives us a substantial platform of profitable voice customers from which to launch our drive into the broadband market in 2006”. The acquisition would add £4m to pre-tax profits for the current financial year and £20m the following year.

In a note to investors Fanos Hira, an analyst at Bear Stearns & Co, said both deals “appear on first inspection strategically and financially sensible”.

The company said the Onetel sale was due to be completed on December 31 and would increase pre-tax profits for the current year by about £4m, rising to £20m the following year.

All newly-acquired customers will be migrated to the TalkTalk brand as soon as possible, a spokeswoman said.

The Onetel acquisition also brings 40,000 mobile telephony and 60,000 broadband customers.

Charles Dunstone, Carphone’s chief executive and founder, had previously expressed interest in buying Cauldwell Communications, which has 560,000 fixed-line customers.

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