Vodafone Group beat off rivals to acquire the Italian and Spanish assets of Tele2 for 537 million pounds ($1.1 billion), a Dow Jones report said.
According to the Dow Jones report, the world's largest mobile phone operator by revenue said it would pay cash for the assets in a debt-free deal.
Sweden's Tele2 offers fixed-line and Internet services to more than 2.6 million clients in Italy, the report said.
In Spain, it provides broadband and fixed-line telephone services, the report said.
Vodafone CEO Arun Sarin was quoted by the Dow Jones report as saying that the deal is not expected to materially impact on the group's ongoing capital intensity ratio in Europe.
It is also expected to be broadly neutral to adjusted earnings-per-share in the first full year after acquisition, excluding the impact of acquired intangible asset amortization, the report said.
The acquisition gives Vodafone greater access to two fixed-line European markets where broadband penetration is low, making it commercially viable for them to buy assets, the report further said.