The deal announced on Friday values Vodafone Japan at around 1.8 trillion yen ($ 15.30 billion) including debt and will allow Vodafone to return 6 billion pounds to shareholders.

Softbank, Japan’s largest broadband Internet provider, has been setting its sights on Japan’s $ 78 billion mobile market for years as it aims to become a pre-eminent communications company, providing broadband, mobile and Internet services and content.

Vodafone said it would return 6 billion pounds to shareholders, adding that the figure amounts to around 10 pence per share. The company does not expect the return of capital to impact on its credit ratings.

"It’s good news. The focus will now be on what form the return of cash will take, whether it will be dividends or more share buybacks. We will press them very, very strongly to make it a special dividend," said Richard Marwood, fund manager at AXA Investment mangers.

Marwood said the price was at the top end of what people were expecting.

Vodafone said it would incur an impairment charge of around 4.9 billion pounds in its results for the year to the end of March, 2006, as a result of the stake sale.

It added that it now expects to record an impairment charge in the second half of the year ending March 31, 2006, at the upper end of the 23 billion to 28 billion pound range indicated on Feb. 27.

Vodafone Chief Executive Arun Sarin said the sale price was attractive and would enhance the company’s adjusted earnings per share.

"It has become increasingly clear that the greatest operational benefits come from strong local and regional scale," said Sarin, adding Vodafone only wants to put capital where it can create superior returns in markets offering a strong local position.

"In the case of Japan, we have been making progress on the turnaround in recent months. However, given the relative competitive position of the business, the reduced prospects for superior long term returns and a good offer from Softbank, the board took the decision to sell," Sarin said in a statement.

Under the deal Softbank will acquire all of the common equity in Vodafone Japan via its wholly-owned Bidco subsidiary.

At 0952 GMT, Vodafone shares were up 1.5 percent at 132 pence, against a 0.7 percent rise in the FTSE 100 index.