British-based company Vodafone is buying TelstraClear for 840 million NZ dollars ($660 million) and it was announced on Thursday.

Vodafone will acquire TelstraClear's voice and data-based services, network infrastructure and New Zealand customer base.

Parent company Telstra revealed in June this year that it was in talks with Vodafone about the future of TelstraClear, its New Zealand operation which has struggled in recent years.

The purchase gives Vodafone a much stronger presence in the phone and broadband market, and complements its dominance in the mobile phone sector.

The news knocked its main rival, Telecom, whose share price declined about 1 percent immediately after the announcement on Thursday.

The deal still requires regulatory approval, including from New Zealand's Commerce Commission and Overseas Investment Office.