Japanese communications firm Softbank will buy the Japanese unit of telecoms group Cable & Wireless for $132 million.
The deal will make Softbank the second-biggest player in Japan's competitive international phone business.
C&W, Britain's second-biggest corporate telecoms provider, entered Japan in 1986, targeting corporate customers. But its local unit, Cable-Wireless IDC, has been unable to keep up in a cut-throat market.
The deal would give Softbank 230,000 new corporate and individual customers for its fixed-line business, adding to the 527,000 it took on when it bought major telecoms firm Japan Telecom Co. earlier this year.
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The deal is expected to be completed in the fourth quarter of the current business year to March 2005.