An internet service company in Radley, near Abingdon, has been bought by Netscalibur, one of the largest private-equity telecom ventures in Europe.

FDD, of Clockhouse Barn, Sugworth Lane, is one of Britain's top five Internet Service Providers in the UK in terms of speed and reliability of data transfer. It boasts 18,000 customers and services the websites of companies such as Siemens, The Daily Telegraph and Kodak Eastman.

The size of the deal was not revealed, but Netscalibur has now spent half the 160m it has raised from investors to cherry-pick the best Internet service companies in Europe. It says that FDD, its fifth acquisition in six months, will allow it to spearhead aggressive growth in web-hosting services. FDD, set up in 1996 by Geoff Lane and Joe Kelly, has a workforce of 25. It was one of the first companies in the UK to offer ADSL connections to the Internet.

ADSL operates over normal telephone lines with modems using digital coding techniques to squeeze up to 99 per cent more capacity out of a phone line. Users can surf the Internet and make normal telephone calls at the same time.

Netscalibur believes its competitive advantage is based on reorganising the economics of the European Internet services market. Mr Kelly said: "We were impressed by Netscalibur's combination of scalability and entrepreneurial spirit. We feel the company has an innovative business model and management with talent and vision.

"We are joining a company that will reshape the market by responding to customers and challenging existing standards of service." Netscalibur has 10,000 customers, employs 370 people and forecasts revenue of £26m for 2000.

With the acquisiton of FDD, it says it now offers the most advanced server management and co-location services in Europe.

The acquisition also marks a further milestone in Netscalibur's expansion plan in the booming European web-hosting market, forecast to grow at nearly 60 per a year for the next three years. The company plans to open two state-of-the-art data centres in London's Docklands and in Frankfurt.

Chief executive Francesco Caio said: "FDD is an acknowledged leader in web hosting and I am delighted it has joined the Netscalibur team.

"Its expertise will accelerate the development of our pan-European centre of excellence for web-hosting services. We remain on the lookout for the best people and the best investment targets in Europe."