UPDATE: Vodafone In Talks To Sell Loss-making Japanese Arm

LONDON (Dow Jones) -- Mobile-phone company Vodafone Group rallied 9% on Friday after saying it's in talks to sell its loss-making Japanese arm.

Vodafone said it's discussing a sales of the division to Softbank Corp., the Japanese investor.

Its shares, which started rallying ahead of the company's announcement, rose 9.4% to 122.25 pence in London.

In Japan, Vodafone is the third-ranking operator behind NTT DoCoMo and KDDI.

Vodafone shares have been driven to three-year lows on a series of profit warnings.

On Monday the company had said it would have to write off up to $49 billion in goodwill, mostly on its German operations, and lowered its revenue and earnings guidance for the year ending with March 2007.

Average revenue per user fell 3.7% in the December-ending quarter in Japan, an improvement from the 5.4% fall in the September-ending quarter.

(END) Dow Jones Newswires "

Posted to the site on 3rd March 2006