Hutchison Whampoa sold a third of its holding in Vodafone AirTouch yesterday, raising GBP3.2 billion (about HK$39.27 billion) to fund bids for third-generation mobile phone licences around the world. The sale of Vodafone stock, which bankers yesterday called the largest block trade in corporate history, will generate an extraordinary profit of HK$1.6 billion. That will be in addition to the exceptional HK$118 billion gain Hutchison made from the sale of its 44 per cent holding in British mobile phone operator Orange to German telecoms group Mannesmann. Hutchison's stake in Mannesmann generated by that deal was converted into Vodafone stock when Vodafone took over Mannesmann last month. Hutchison's finance director Frank Sixt last night said the group intended to hang on to the 3.5 per cent stake in Vodafone it is left with after the sale. Hutchison, which is due to report its annual results today, had GBP10 billion in Vodafone stock before yesterday's sale. 'We are planning to fund a phased expansion of third generation wireless business, around the world, but particularly in Europe,' Mr Sixt said. Third generation is the latest standard in mobile communication services, and is already being rapidly rolled-out in a number of countries. The services can offer data rates of up to two megabits per second and deliver broadband multimedia communications. Britain is in the midst of holding auctions for third generation licences, and this week Hong Kong's Office of the Telecommunications Authority said it would be consulting the industry over a licensing framework. 'We see this as a tactical asset re-allocation,' Mr Sixt said. 'At the end of the day, it seems pretty clear that we have a near-term requirement of maybe US$5 billion that we can use for third generation.' He said Hutchison's remaining holding in Vodafone was regarded as a 'good investment in a good stock in the telecom industry'. It has been proposed that Hutchison managing director Canning Fok Kin-ning be appointed as a non-executive director of Vodafone, given the large holding Hutchison still has. Yesterday's deal, which Vodafone said was revealed to them minutes before it took place, was handled both by Goldman Sachs, which is Hutchison's main investment bank, and Deutsche Bank, which is the largest dealer in Vodafone stock. The deal involved the placement of 925 million Vodafone shares with institutional investors. Hutchison agreed with both banks that it will not try to sell any more stock until September 1. The stock was priced at 349 pence, a discount of 7.85 per cent to Vodafone's closing price on Tuesday of 378.75 pence. Bankers believe the transaction should have been completed by the end of trading in London yesterday. Vodafone was at 367 pence in afternoon trade in London. Goldman Sachs believes that the last block trade of such a magnitude to be executed was a placing of US$1.97 billion of British Petroleum stock in May 1997.