July 3 (Bloomberg) -- Vodafone Group Plc, the world's biggest mobile-phone company, agreed to buy a 70 percent stake in Ghana Telecommunications Co. from the government for $900 million to expand in one of Africa's fastest-growing markets.

The deal values Ghana Telecom at about $1.3 billion and the government of Ghana will retain a 30 percent stake, Newbury, England-based Vodafone said in an e-mailed statement today. Ghana Telecom posted 2007 earnings before interest, taxes, depreciation and amortization of $42 million on sales of $290 million, Vodafone said.

``The price seems to be reasonable and the deal is in line with Vodafone's strategy to push into emerging markets,'' said Adam Steiner, who helps manage the equivalent of $6.2 billion including Vodafone shares in London at SVG Capital Plc, via phone. ``With the economic downswing in Europe and the U.S., more and more investors will probably decide that they should hold shares of companies with growth prospects in emerging markets.''

Vodafone has expanded in emerging markets in the past two years with acquisitions in Turkey and India, after slower growth in Europe hurt investor confidence. Shareholders representing 9.5 percent of the stock voted against Chief Executive Officer Arun Sarin at the company's 2006 annual meeting. Vodafone had 252 million customers at the end of 2007, of which 106 million were in eastern Europe, the Middle East, Africa and Asia.

Vodafone declined 0.2 percent to 152.15 pence in London trading today. The stock has lost 19 percent this year, while the U.K.'s FTSE-100 has declined 15 percent.

`Attractive' Market

``Ghana is one of the most attractive markets in Africa with mobile subscribers growing at more than 55 percent per annum and mobile penetration around 35 percent,'' Sarin said in the statement.

The number of Vodafone's mobile-phone customers rose 26 percent to 260 million worldwide in the 12 months through March. The company's revenue from emerging markets surged 45 percent to 9.35 billion pounds while sales in Europe increased 6.1 percent to 26.1 billion pounds.

Sarin said May 27 he will step down in July after reporting a record 6.66 billion-pound annual profit. Sarin had become under pressure to deliver a new strategy after Vodafone lost 21.9 billion pounds, the largest annual loss in European history, in the year ended March 2006. In April of that year, Sarin reorganized Vodafone into three units covering Europe, emerging markets and new technology.

Vodafone said today Ghana Telecom will invest $500 million through the next five years in its operations and network.

Fiber Network

As part of the deal, the government has agreed to transfer its fiber-network assets to Ghana Telecom. The deal still needs approval from the Ghanaian parliament and Vodafone predicts the transaction will close in the third quarter. The deal will be ``broadly neutral'' to adjusted earnings per share in the first year of acquisition, Vodafone said.

Vodafone bought a 52 percent stake in Hutchison Essar Ltd., now India's third-largest wireless operator, for $10.7 billion in May 2007, and purchased Turkey's Telsim Mobil Telekomunikasyon Hizmetleri AS for $4.55 billion in 2006. On May 28, Vodafone and a local partner said they will pay $2.1 billion for Qatar's second wireless license.

Vodafone has also said it wants to increase its 50 percent stake in Vodacom Group Ltd., South Africa's biggest mobile- phone operator by subscribers. Since the end of 2005, Vodafone has sold its units in Japan and Sweden, as well as stakes in Swiss and Belgian mobile-phone companies, for a total of $21.8 billion.

To contact the reporters on this story: Simon Thiel in London at sthiel1@bloomberg.net;

Last Updated: July 3, 2008 11:43 EDT