Vodafone is exiting Belgium with the sale of its 25 per cent stake in Proximus, the country's biggest mobile phone group.

The FTSE 100 company has agreed a €2 billion (£1.4 billion) deal to offload its stake in the company to Belgacom, Belgium's dominant fixed line operator.

It is the first deal struck by Arun Sarin since the Vodafone chief executive saw 15 per cent of his shareholders fail to endorse his re-election as chief executive at May's annual meeting.

The group said the Belgian proceeds would be used to pay down debt. "We do not... see ourselves as the most appropriate long-term holder of this minority stake. In line with our strategy of managing our portfolio and maximising returns, we have achieved an attractive price with this sale."

The company said it expected to book a gain of £450 million from the sale in its year to March 2007 results.

Analysts at Deutsche Bank told clients the deal underscored how rival operators were willing to ascribe more value than financial markets to Vodafone's assets.

Vodafone said it had also signed a five-year agreement with Proximus under which Vodafone users would continue to rely on the Blegian company's network when using their phones in the country.

Speculation that the group would sell its 45 per cent holding in Verizon Wireless eased earlier this month when Verizon, its partner in the US mobile phone business, gave its strongest indication yet that the $50 billion partnership between the two companies is not likely to be unwound in the near future.

The group's shares closed up 1.50p at 112.25p on Friday. A change of 1.35 per cent

added 0.5p to 111.25p by 10.20am.

You can track Vodafone's share price by clicking here.

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