Carphone Warehouse The owner of the UK's largest chain of mobile phone stores and the TalkTalk landline and broadband business is paying £370m for the operation.

AOL UK has 2.1 million customers across the country, 1.5 million with broadband connections and 600,000 on dial up.

Carphone Warehouse first moved into broadband services in April.

It will be keeping the AOL name and the US firm's policy of charging customers.

AOL UK is being sold by its American parent company Time Warner.

The UK's largest residential internet provider is currently NTL, which has 2.9 million residential customers, following by BT on 2.2 million