British Telecom is preparing to sell investments in Japan and Spain to Vodafone as it puts the finishing touches to a £10 billion debt-cutting plan.
BT said today it is in talks to sell its 20 per cent stake in Japan Telecom, the Japan's third largest carrier, to arch rival Vodafone.
It is also discussing the sale of its 20 per cent stake in Japan Telecom's mobile unit J-Phone.
A sale of both stakes could contribute more than £3 billion to BT's emergency debt-cutting package, which may also include the sale of £5 billionof new shares.
Vodafone said it was also discussing the purchase of BT's 17.8 per cent stake in Spanish mobile operator Airtel. Vodafone already owns 73 per cent of Airtel.
BT shares rose as much as four percent to £5.80on the news, while Vodafone fell 1.3 per cent to £2.10. Japan Telecom closed up 8.74 per cent at 2.24 million yen.
BT had insisted its Japanese and Western European mobile stakes were core investments that it would not sell, but it has bowed to shareholder pressure to dispose of holdings that it had no hope of converting into a majority.
The moves follow the appointment of Christopher Bland as chairman to replace Sir Iain Vallance, another concession to shareholders that has accelerated BT's plans to slice a third off its £30 billion debt mountain.