Israeli VoIP start-up Jajah is expected to be acquired by Telefonica's mobile phone unit O2 for $200 million (€139m) this week, according to news reports.
It is understood that O2 has been in a competitive bidding contest with Cisco and Microsoft for the company which launched in 2005.
Jajah claims to have 15 million subscribers who use its IP network for discounted voice calls to 125 countries.
To date it has raised €24 million from Deutsche Telekom, Intel Capital, Sequoia and other VC funds.
Analysts suggest that the reason for the sudden interest in the VOIP provider is its lean valuation compared to Skypes’s at $2.75 billion and the current consumer expectation that VoOP services will be included in the mix among traditional services.