No financial details of the operation were provided.

But in a joint statement, Moviles and Mobilcom said that 3G would continue to operate as a separate company, adding that Mobilcom intended to sell some of its spectrum before 2005 to confirm with Austrian legislation.

In 2000 Moviles paid 117 million euros (145 million dollars) for its Austrian UMTS licence but later pulled the plug on its UMTS business in Europe, writing down about 4.8 billion euros for its investments.

Telefonica Moviles is a subsidiary of the Spanish communications giant Telefonica.

UMTS, universal mobile telecommunications system -- also known as third generation -- is designed to provide e-mail, high-speed Internet access and live sound and image broadcasts to compatible handsets.

SPACE.WIRE