Telecommunications company Eircom is to buy Ireland's third largest mobile phone operator.
Eircom, quoted on both the London and Dublin stock exchanges, will pay 420 million euros (£291 million) to take over Meteor.
Meteor is also the country's fastest growing mobile business, with its subscriber base doubling from 181,000 to 410,000 in the last 18 months.
Ahead of the company's AGM in Dublin, managers yesterday said their aim was to double Meteor's market share of ten per cent within three to four years by continuing to be the low- cost operator.
Sir Anthony O'Reilly, chairman of Eircom, said winning the bid for Meteor would deliver on the promise to lead Eircom back into the mobile market.
Dr Philip Nolan, chief executive of Eircom, said the deal would ensure the company had a strong combination of broadband and mobile services.
"This has been our goal since returning to the market last year.
"We look forward now to providing our unrivalled base of 1.4 million customers with our newly acquired mobile capability, as the only company which can offer Irish consumers the full range of services," he said.
The acquisition will be funded by a fully underwritten rights issue at a minimum subscriber price of 1.10 euro (76p) per share.
Analysts said that a price tag in excess of 400 million euros would be expensive relative to other acquisitions in the sector and would likely dilute earnings in the near term, but they accepted that buying Meteor makes strategic sense for Eircom.
"All in all, a deal that had to be done but at a price that will need to be justified quickly in financial and strategic terms," Davy analyst Jack Gorman wrote in a research note.
However, Neil Clifford, analyst at Eircom's broker Goodbody, pointed out that monthly returns in Ireland are 47 euros per mobile phone subscriber versus a European average of 31 euros.
Shares in the company were 5.4 per cent weaker, following the announcement.
