11 July 2012 Last updated at 22:08 ET

Vodafone to buy Telstra's New Zealand subsidiary

Shares in Telstra were suspended before the announcement

Australia's biggest telecommunications company, Telstra, has sold its New Zealand subsidiary to Vodafone for 840m New Zealand dollars ($668m; £431m).

Vodafone New Zealand would be gaining TelstraClear's network infrastructure, voice and data-based services and all its customers from the deal.

The acquisition is subject to regulatory approval.

Analysts said the move would create a more competitive market in New Zealand.

Both companies trail the dominant player Telecom in terms of market share, which has about a 50% of the telecommunications market.

The deal had been expected after Vodafone approached Telstra about a potential sale of TelstraClear last month.

"The deal is a natural one, bringing together TelstraClear's fixed telecommunications and data products and corporate client-base with Vodafone New Zealand's mobile offering and retail customer base," said David Thodey, Telstra's chief executive in a statement.