According to the International Business Times , the deal, is to be officially completed by the end of the year, will be settled in cash and shares.

Deutsche Telekom will have a 12 percent stake in the company and will be given the right to appoint one board member. Orange will also get a four per cent stake.

BT CEO Gavin Patterson said: "This is a major milestone for BT as it will allow us to accelerate our mobility plans and increase our investment in them.

The UK's leading 4G network will now work with the UK's biggest fibre network, to create the leading converged communications provider in the UK, he said.

"Consumers and businesses will benefit from new products and services as well as from increased investment and innovation."

It will mean that BT can finally start offering quad-play packages, providing customers with TV, broadband, landline and mobile services in one bundle.