Tenant not mine

Hi I am buying a 1 bed flat in Essex. this is a cash buy.
I am buying to rent out, there ia a tennant 'X' in the flat already
paying rent to mr 'Y' who owns the property.
The Tennent pays rent through an estate agent.
I spoke to 'X' and said i would keep her on as my tennent and keep the rent the same.
The Tennancy is AST and I beleive 'X' has been there for 6 months and wants to stay there.
I guss my completion date will be early January 2012.
*How am I going to sign up 'X' as my tennent ?
*How can I get the deposit from 'X' ?
*Will I need a solicitor to help me with the tennency.?
*I will be a new Landlord, I dont want to use an estate agent, I want to
handle all the rent work on my own, any advice or pit falls?
Thanks
CBJ

{Mod - names changed to 'x' / 'y' just in case they are real names}