Telenor to Buy Swedish Mobile Phone Co.

OSLO, Norway - Norway's Telenor ASA on Monday said it had agreed to buy Sweden's No. 3 mobile phone provider from Vodafone Group PLC for about 1 billion euros ($1.2 billion).

"The acquisition of Vodafone Sweden is in line with Telenor's growth strategy and will enhance our position in the Scandinavian mobile market," said Morten Karlsen Soerby, Telenor's executive vice president.

State-controlled Telenor said the purchase will increase its share of the Scandinavian mobile market to 37 percent, with 5.6 million subscribers.

A news release said the deal should be completed by the end of the year, pending approval by competition authorities.

Vodafone and Telenor have agreed that Vodafone Sweden customers will continue to be able to use services provided by the British group, which is among the world's largest mobile telephone service providers.

"We have a good business in Sweden, but the particular industry structure and regulatory environment means that it makes more sense for our customers, our employees and our shareholders for a pan-Nordic player like Telenor to own the company," said Vodafone chief executive Arun Sarin.

Vodafone Sweden has a staff about 1,500 people, and claimed 1.5 million subscribers. For the financial year 2005, which ended March. 31, it posted 6.7 billion Swedish kronor ($848 million) in revenue.

Telenor, based at Fornebu on the outskirts of Oslo, employs nearly 22,000 workers in 16 countries. The Norwegian government owns about 53 percent of its shares.

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