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March 1 2006

Vodafone has signed a five-year deal with Huawei Technologies [HWT.UL] under which the Chinese firm will supply exclusive Vodafone-branded 3G mobile handsets, the UK-based mobile operator said on Wednesday.

The handsets, which will be sold by Vodafone in 21 countries, will only carry the Vodafone name.

Vodafone, the world's biggest mobile operator by revenues, anticipates offering the first Huawei-manufactured 3G handset in September 2006 this year.

The deal also marks the Chinese company's first significant entry into the European handset market.

Neither side disclosed the scale of the order or any pricing details.

"This agreement with Huawei shows the cost benefits Vodafone's size and global reach can bring to our customers," Vodafone Chief Marketing Officer Peter Bamford said in a statement.

"We will be able to offer even better 3G phones at more competitive prices across our markets."

Huawei, which is China's top telecoms equipment maker, said the agreement with Vodafone would help it to become a leading player in the world in handset development and production.

"This agreement offers us a great opportunity to expand into new regions alongside the world's leading mobile community," said Ping Guo, senior vice president at Huawei.