The announcement yesterday will formalise the relationship the two companies already had for the past two years.
Snap is the fourth-largest provider of broadband in New Zealand and 2degrees has a 23% share of the mobile market by customers and 17% by revenue.
2degrees chief executive Stewart Sherriff said he was ''darned excited'' to announce the move.
The inability to offer landline services had held back the company's mobile growth.
He had three options - buy, build or partners - and decided buying was the best option.
''We'll be developing new product under the 2degrees brand that will be innovative and disruptive. We'll be a challenger brand that takes it to the big guys.''
Snap provided the perfect complement to the mobile offering and would allow 2degrees to deliver the total package to the customers of both companies, he said.
Snap chief executive Mark Petrie would join the 2degrees senior leadership team and lead the fixed services division of the wider group.
''One thing we've learned in the last couple of years, apart from the fact we work well with 2degrees, is there is a limited window of opportunity to win business as the UFB networks are rolled out.
"A fixed-mobile offer allows us to put our best foot forward and 2degrees is the best company to drive that growth,'' he said.
Neither Mr Petrie nor Mr Sherriff would comment on speculation the deal was for $26 million, including cash of $10 million.
Mr Petrie, who bought out the Christchurch-based ISP's other shareholders three years ago, said the Snap network had been built for scale and was ready to scale up further.
Snap was set up 15 years ago and provided internet and IT services to a range of businesses nationally and had a large customer base in the South Island and a 20% share of the residential fibre market.
Companies Office records list Mr Petrie and Toby Ross Giles as the directors of Snap Trustees, the shareholding entity for Snap, while Snap's directors are Mr Petrie, Christchurch professional director Bruce Matheson and Katherine Meads, a former director of various Ngai Tahu entities.
Launched in 2009, 2degrees now had more than 50 retail outlets, 780 staff and 97% network coverage across the country. All 120 Snap staff would remain with the merged company.
Mr Sherriff said it would be another three to four months before the company launched fully bundled offers.
BusinessDesk reported 2degrees had not yet turned a profit, although it pared back losses in calendar 2014 to $35.9 million, down 20% on the previous year's loss of $45.2 million.
It reported positive operating earnings for the second year since it was set up.
Snap was profitable, funding development out of cash flow.2degrees had already committed more than $550 million in building the country's third mobile phone network.
Last month, the Hautaki Trust cut its stake in 2degrees from 10.3% to 7.4%, selling out to the company's majority American owner, Trilogy International.
The trust had earlier borrowed $2.6 million from Trilogy in 2011 to maintain its stake in the mobile phone operator at just over 10%, through a five-year loan secured on its shareholding.
The other two investors in 2degrees were European investment company Communication Venture Partners and KLR Hong Kong Ltd.
