TalkTalk has agreed a £1.1bn takeover by its second-largest shareholder Toscafund and a private-equity investor in a deal that would see the company taken private.
The broadband provider's board revealed the agreement in an update to the City - days after Sky News reported that an announcement on the terms was imminent.
TalkTalk said shareholders would receive 97p-per-share - a 16.4% premium to the share price on 7 October before the offer was first proposed by investment company Toscafund and Penta.
Its chairman, Sir Charles Dunstone, said: "Being a private company would allow us to accelerate adoption and focus on our role as the affordable provider of fibre for businesses and consumers nationwide.
"The telecoms industry is going through a fundamental reset and we are keen to play our part in it."
Ian West, senior non-executive director at TalkTalk, said: "The Independent TalkTalk directors have taken into account the risks associated in achieving TalkTalk's strategic ambitions and the wide support that ToscaFund would provide
in this regard.
"The Independent TalkTalk directors believe, taking into account the advice they have received, that the terms of the cash offer are fair and reasonable, and are unanimously recommending that shareholders accept the cash offer."
The company revealed the deal while updating investors on its performance during the half-year to the end of September.
It reported an estimated £9m hit to its headline profits from the effects of the COVID-19 pandemic.
Profits fell almost 13% to £122m and were supported by 187,000 net fibre customer additions.
Shares rose by almost 3%.
Tristia Harrison, the company's chief executive, said: "Our financials have been resilient in the first half, albeit with some impact of COVID-19 on headline revenue and EBITDA.
"Lockdown has taught us that fast, reliable and affordable connectivity is more important than ever, and we have seen excellent network performance despite a 40%+ increase in data usage."
Sir Charles, who co-founded The Carphone Warehouse and still holds a stake in its successor company, Dixons Carphone, established TalkTalk in 2004.
It was spun off six years later.
TalkTalk has more than four million customers across its range of services, competing with rivals including BT Group and Sky, the immediate owner of Sky News.
