Comcast has finalized the acquisition of CityNet, a city-owned ISP based in San Bruno, California for $8 million.

The cable company sealed the acquisition after San Bruno City Council members voted in favor of the deal earlier this month.

Founded in 1971, CityNet serves more than 5,400 residents and businesses in San Bruno, a city close to San Francisco.

It's the first time Comcast has acquired a municipally owned broadband provider in California.

The sale of CityNet comes amid struggles in recent years, with rising costs leading to debts of around $21.5m.

“Rates simply were not keeping pace with costs,” the city manager’s office wrote in a January report to the City Council, as reported by KQED. “CityNet has grown increasingly technologically obsolete over the past decade.”

Council members said the sale was inevitable given the losses and noted that from a financial standpoint, it doesn't make any sense for the city to run its own cable/Internet enterprise.

“We welcome Comcast to our community,” said Mayor Rico E. Medina of San Bruno. “CityNet serves our community well, but the evolving demands of maintaining and upgrading our network have highlighted the need for a partner with the resources and expertise that Comcast brings. This transition will ensure that our residents and businesses continue to have access to top-tier broadband services today and well into the future.”

Comcast noted that it will invest and improve CityNet's existing infrastructure while providing its products and services including Xfinity and Comcast Business to residents.

In the company's announcement, Comcast said it has invested nearly $4 billion in technology and infrastructure in the past three years in California alone, plus more than $20bn nationwide in the past five years.