Analysts said the exercise of part of an option to raise Vodafone's holding to 20 per cent by the end of next year was no surprise. But the price of the deal was welcomed for the potential knock-on effect it would have on Vodafone's own valuation and that of rival Cellnet.
According to one commonly used measure, which compares the value of a mobile phone company with the number of its subscribers and their relative wealth, SFR is valued by acquisition more highly than Vodafone itself. One analyst said it created a new valuation benchmark.
Gerald Whent, chief executive, said: "Our strategy is to increase our overseas share- holdings wherever possible. The opportunity to acquire additional equity in SFR is extremely important as the French market has great potential for further development."
SFR runs one of the two mobile telephone networks in operation in France, with France Telecom running the other. Bouygues SA, which was awarded the third mobile phone licence, is expected to launch its service before the end of the year.
Vodafone now has stakes in mobile phone businesses in 14 overseas countries. These range in importance from a 95 per cent holding in Vodafone PTY in Australia to less than 4 per cent in Denmark's second operator, Sonofon.
It has now achieved its aim of balancing its UK business with an equally sized business overseas to provide growth outside the increasingly competitive market in the UK. The success of Orange in attracting subscribers to the all-important digital market has put pressure on pricing for all four UK operators.
Mobile telephony has not been the success in France that it has so far in the UK, Italy and Germany, but there is thought to be substantial demand for the service.