LONDON -- Vodafone AirTouch Plc, the world's biggest cell phone company, said on Thursday it was increasing its stake in nine regional mobile phone companies in Japan in a series of deals valued at around US$550 million.
The largest stakes were picked up from Cable & Wireless Plc, Britain's second biggest telecoms group, which has long been expected to sell the minority assets as part of a global strategy to dispose of businesses in which it lacks control.
C&W, which said it stood to make a pre-tax profit of $389 million on the $411 million sale, saw its shares jump by over 3 percent.
Vodafone, which inherited small holdings in the nine groups after buying AirTouch in January, has now secured stakes of over 20 percent in each -- and the potential influence in Japan which it has lacked in Germany, where it has sold its 17.5 percent stake in E-Plus.
The deals also give it a stronger foothold in a $100 billion telecoms market, which is second only to the United States in size, and which is being used as a testing ground for next generation, high tech, multimedia mobile licences and services.
Shares Surge in Cut-Price Deals: As Vodafone's robust shares rose to a high of 296p before settling around 294-3/4, a rise of almost 4 percent, analysts welcomed the deals at lower-than-expected prices.
"It seems to me a good deal and not very expensive either," said Jim McCafferty, telecoms analyst at SG Securities.
"I think Vodafone having an influence on these businesses will give it some experience and clout when it comes to negotiating and bidding for new licences."
Vodafone is also buying part of three stakes owned by Japan Telecom, Japan's number three carrier in which British Telecommunications Plc and AT&T Corp hold a 30 percent stake.
Vodafone, which said it was raising its stakes in the nine groups to between 21.4 and 28.8 percent from 4.5 to 15 percent, said the deals would make it the second biggest shareholder in the groups behind Japan Telecom if they were approved.
C&W, whose core businesses stretch from Europe to the US and Asia, is selling its stakes in Digital Phone Group, which includes three companies, and a 2.5 percent holdings in each of six Digital Tu-Ka companies.
The three Digital Phone and six Digital Tu-Ka companies have been operating under the "J-phone"' name since October 1. C&W said it would focus on Japanese international carrier IDC, the company it fought for and won in June after a hotly contested and high profile bid battle against giant Nippon Telegraph and Telephone Corp.
C&W, which has sold some cellular interests as it re-focuses on the booming corporate communications market, has disposed of its 50 percent stake in UK mobile phone group One2One and a 20 percent stake in France's Bouygues Telecom.
Copyright 1999 Reuters Limited.
