China Telecom will lease CDMA telecom network from its state-owned parent at a fee equal to 28 percent of the CDMA revenue each year from 2008-10, allowing the nation's top fixed-line provider to enter a lucrative mobile arena.

The telecom group said in a statement on Monday the maximum lease fee payable for the period ending in December 2008, 2009 and 2010 is expected to be up to 4 billion yuan ($586.7 million), 20 billion yuan, and 35 billion yuan respectively.

In June, the company agreed to pay 43.8 billion yuan to buy the Code Division Multiple Access (CDMA) business from the Unicom group as China kicked off its overhaul of the world's largest telecoms industry.

Its parent, China Telecom Group, will pay 66.2 billion yuan for the CDMA network.

China Telecom had said it planned to issue up to 80 billion yuan worth of bonds, mainly to fund the acquisition.

($1=6.818 Yuan)

Source:Reuters