Sale of Vodafone Japan

Vodafone Group Plc
17 March 2006


17 March 2006

                             SALE OF VODAFONE JAPAN

                           £6 BILLION RETURN OF CASH

Vodafone Group today announces an agreement to sell its 97.68% interest in
Vodafone Japan to SoftBank. The sale values Vodafone Japan at an Enterprise
Value of approximately Y1.8 trillion (£8.9 billion) of which £6.8 billion will
be received in cash on closing. Subsequently, Vodafone will distribute £6
billion of cash to shareholders.

Arun Sarin, Chief Executive of Vodafone, commented:

'I am pleased to announce this transaction which represents a good outcome for
Vodafone. It is at an attractive price, will result in a £6 billion distribution
of capital to shareholders and is enhancing to adjusted earnings per share.

The Board has arrived at the decision to withdraw our capital from the Japanese
market based on several key criteria.

It has become increasingly clear that the greatest operational benefits come
from strong local and regional scale. We seek to deploy capital only where we
can generate superior returns for our shareholders in markets that offer a
strong local position.

In the case of Japan, we have been making progress on the turnaround in recent
months. However given the relative competitive position of the business, the
reduced prospects for superior long term returns and a good offer from SoftBank,
the Board took the decision to sell.

I would like to pay tribute to the management and employees of Vodafone Japan.
They have made considerable progress in turning the business around. I am
pleased that with the on-going relationship with SoftBank, one of the leading
telecommunications and media companies in Japan, we will continue to benefit
from insights in the Japanese market'.

Highlights of the deal

*  Whilst the nominal enterprise value derived from the cash proceeds and
   the face value of the non-cash instruments is Y2.0 trillion (£9.8 billion),
   Vodafone estimates that the fair value of the transaction on an Enterprise 
   Value basis is Y1.8 trillion (£8.9 billion)

*  SoftBank intends to acquire 100% of the common equity of Vodafone Japan
   through a wholly owned SoftBank subsidiary ('Bidco')

*  As a result of the transaction, Vodafone will receive three principal
   components of value:

     -  Approximately £6.8 billion of cash payable on closing

     -  Preferred shares in Bidco with a face value of Y300 billion 
        (£1.5 billion) carrying zero dividend. The preferred shares will be 
        redeemable at Bidco's option. After June 2013 the preferred shares 
        will carry a coupon of 12%

     -  A subordinated loan with a face value of Y100 billion (£0.5 billion)
        repayable to Vodafone. This loan will be subordinated to Bidco's 
        acquisition debt, carries a coupon of 5% and is repayable after 30 
        September 2013

     -  Vodafone estimates the combined fair value of the preferred shares and 
        the subordinated loan is approximately £1.1 billion

*  In addition Vodafone has been granted warrants with the right to
   subscribe to equity representing 10% of Bidco exercisable after 31 March 2013
   subject to certain minimum cumulative levels of EBITDA being generated 
   between 1 April 2006 and 31 March 2013

*  Vodafone presently intends to retain the preferred shares and the warrants 
   in the short to medium term

*  SoftBank will assume approximately £0.8 billion of external debt and
   other liabilities outstanding from Vodafone Japan

*  The preferred shares confer the right for Vodafone to appoint one
   director to the Boards of both Bidco and Vodafone K.K.

*  Vodafone and SoftBank have entered into discussions regarding the
   formation of a joint working relationship involving participation in the 
   supply and distribution of data and content. The purpose of the relationship
   is also to provide knowledge and information sharing between the two parties
   and to ensure that Vodafone continues to have access to the ongoing 
   technological and service developments in the mobile industry in Japan

Use of Proceeds

Vodafone will make a distribution of £6 billion, equivalent to around 10 pence
per share, to shareholders following closing of the transaction. Details of the
precise method of distribution will be released at the preliminary results in
May. Vodafone intends to complete its existing £6.5 billion buyback programme
for the year ending 31 March 2006 and will update the market further on its
distribution policy in May.

Financial Impact

Vodafone expects that the transaction and the return of capital will not impact
Vodafone's credit ratings.

Vodafone expects that the transaction and the return of capital together will be
enhancing to adjusted earnings per share.

Under IFRS, Vodafone will record an impairment charge of approximately £4.9
billion in its results for the year ending 31 March 2006 in respect of its
interest in Vodafone Japan. On completion of the disposal of Vodafone Japan, a
profit or loss on disposal will be recognised as the difference between the
final sale proceeds less costs to sell and the carrying value at the date of
disposal. The profit or loss on disposal will include, among other items, the
cumulative exchange differences in respect of Vodafone Japan previously
recognised in equity from 1 April 2004 through to completion. Under US GAAP,
Vodafone expects the disposal of its interest in Vodafone Japan to result in a
significant loss that will be recorded within its results for the year ending 31
March 2006.

Vodafone now expects to record an impairment charge in the second half of the
year ending 31 March 2006 at the upper end of the £23 billion to £28 billion
range indicated on 27 February 2006. The impairment charge in respect of
Vodafone Japan will be classified within discontinued operations in the Group's
income statement.

Conditions to the transaction

The transaction will be effected through a take-over bid.

Under the terms of the agreement SoftBank has an obligation to launch a
take-over bid for Vodafone Japan. This obligation is not subject to any material
conditions. Should SoftBank fail to finalise its financing and launch the
take-over bid by 4 April 2006, it would be liable to pay liquidated damages of
Y60 billion (£0.3 billion). Vodafone is legally obliged to sell its shares in to
the bid.

Vodafone expects the transaction to complete in the first quarter of the
financial year ending 31 March 2007.

Restated Guidance for the years ending 31 March 2006 and 2007

There are no underlying changes to the Group's outlook statements.

As a result of the disposal, Vodafone Japan will be classified as a discontinued
operation. The net financial result for Vodafone Japan for the current and
previous financial years, together with the impairment charge, will be shown as
a single line item in the Group's income statement and will be excluded from the
Group's adjusted performance reporting measures. The Group's cash flow statement
will continue to include cash flows from Vodafone Japan, with separate
summarised disclosure of the cash flows from Vodafone Japan for the current and
previous financial years.

The Group's organic growth metrics will also be revised to reflect the disposal.
Accordingly, Vodafone is restating its outlook for the years ending 31 March
2006 and 2007 to reflect the impact of the sale of Vodafone Japan as follows.


                    Previous outlook including    Restated outlook excluding
                    Vodafone Japan                Vodafone Japan
---------------     ---------------------------   ----------------------------

Year ending 
31 March 2006

Organic growth in   In the middle of the 6% to    In the 8% to 9% range
proportionate       9% range
mobile revenue

Organic             Lower end of flat to 1        Higher end of flat to 1
proportionate       percentage point lower        percentage point lower range
mobile EBITDA       range than previous year      than previous year
margin

Capitalised fixed   In the £5.0 billion to £5.4   In the £3.8 billion to £4.2
asset additions     billion range                 billion range

Free cash flow      In the £6.5 billion to £7.0   In the £5.8 billion to £6.3
                    billion range                 billion range

---------------     ---------------------------   ----------------------------

Year ending 
31 March 2007

Organic growth      In the 5% to 6.5% range       In the 5% to 6.5% range
in proportionate
mobile revenue

Organic             Around 1 percentage point     Around 1 percentage point
proportionate       lower than previous year,     lower than previous year
mobile EBITDA       excluding Japan
margin

---------------     ---------------------------   ----------------------------

The Group will provide outlook information for the year ending 31 March 2007 for
capitalised fixed asset additions and free cash flow on 30 May 2006.

                                    - ends -


For further information:


Vodafone Group

Investor Relations                         Media Relations
Telephone: [phone]             Telephone: [phone]


Notes to Editors

About Vodafone

Vodafone is the world's leading mobile telecommunications group with equity
interests in 27 countries across 5 continents with 179.3 million proportionate
customers worldwide as at 31 December 2005 as well as 32 partner networks. For
further information, please visit www.vodafone.com.

About Vodafone Japan

Vodafone Japan is defined as Vodafone K.K. It is the third largest mobile phone
operator in Japan. As at 30 September 2005, Vodafone Japan had total assets of
£6.2 billion under IFRS excluding goodwill and acquired intangible fixed assets.
For the year to 31 March 2005, Vodafone Japan had pre-tax profit of £0.7 billion
under IFRS. For further information, please visit www.vodafone.jp.

About SoftBank

SoftBank is one of the leading Japanese telecommunications and media companies
with operations in Broadband, Fixed Line Telecommunications, e-Commerce,
Internet, Broadmedia, Technology Services, Media and Marketing and Other
businesses. SoftBank is listed on the Tokyo Stock Exchange and had a market
capitalisation of approximately US$32.8 billion at 28 February 2006. Masayoshi
Son is the founder, President and Chief Executive Officer. For further
information, please visit www.softbank.co.jp.




Other

For illustrative purposes an exchange rate of Y205:£1 has been used.

Adjusted earnings per share represent earnings per share under IFRS before the
results of discontinued operations and items not reflecting underlying business
performance.



This press release contains 'forward-looking statements'. In particular, such
forward-looking statements include statements with respect to our expectations
related to the sale of Vodafone Japan to SoftBank, including the amount and type
of consideration to be received in connection with such sale, our use of
proceeds from the sale of Vodafone Japan, the financial impact on Vodafone of
the sale of Vodafone Japan, including the effect on our credit ratings and
adjusted earnings per share and the amount and timing of impairment charges to
be recorded during the year ending 31 March 2006, and the formation of a joint
venture between Vodafone and SoftBank, as well as statements with respect to
Vodafone's restated guidance or outlook for the years ending 31 March 2006 and
2007. By their nature, forward-looking statements are inherently predictive,
speculative and involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future. There are a number of
factors that could cause actual results and developments to differ materially
from those expressed or implied by these forward-looking statements. In
particular, the sale of Vodafone Japan to SoftBank is subject to conditions
typical in transactions of this nature, including SoftBank securing sufficient
financing for the transaction. In addition, some the factors which may cause our
actual results to differ from forward-looking statements related to our outlook
can be found by referring to the information contained under the heading
'Forward Looking Statements' in our interim results announcement for the six
months to 30 September 2005 and under the heading 'Risk Factors' in our Annual
Report for the year ended 31 March 2005. The interim results announcement and
our Annual Report can be found on our website (www.vodafone.com).






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