British mobile phone giant Vodafone has agreed to buy an 11-billion-dollar controlling stake in India's Hutchison Essar in an attempt to move into the world's fastest-growing mobile phone market.

Vodafone, the world's largest mobile phone operator, will pay 11.1 billion dollars (8.5 billion euros) to acquire Hong Kong-based Hutchison Whampoa's 67 percent stake in Hutchison Essar, as part of a deal which the Financial Times said will be the single largest foreign investment in India's history.

"India is destined to become one of the largest and most important mobile markets in the world and this acquisition will enable our shareholders to benefit from our increased investment in this market," said Vodafone's Chairman John Bond.

Including about two billion dollars' worth of debt that Vodafone is to assume, the agreement values Hutchison Essar, India's fourth-biggest mobile phone operator, at about 18.8 billion dollars.

India's Essar group, controlled by the Ruia family, holds the remaining 33 percent and was also reported to be interested in buying out the company.

Vodafone said that it would make an offer to buy out Essar's stake at a price per share equivalent to the price in its bid to acquire Hutchison Whampoa's stake.

Snapping up assets in emerging markets has become a priority for Vodafone as it grapples with a dramatic slowdown in western Europe.

India has the fastest-growing mobile phone market in the world and adds seven million customers a month.

According to Vodafone, Hutchison Essar has about 23.3 million customers nationwide in India, equivalent to about 16.4 percent of the country's total mobile phone market.

Vodafone said in a statement it was targeting an increase of market share to between 20 and 25 percent in five years.

"We are delighted to be deepening our involvement to the Indian mobile market with the full range of Vodafone's products, services, and brand," said Arun Sarin, Vodafone's chief executive.

The British company already holds a 10 percent stake in Bharti Airtel, India's biggest operator, and said that it was giving Bharti the opportunity to buy back Vodafone's 5.6 percent direct stake in it, which Vodafone valued at 1.6 billion dollars.

Vodafone said, however, that it had agreed to a memorandum of understanding with Bharti that would involve the Indian operator and Hutchison Essar sharing their respective infrastructures in an effort to lower costs and expand network coverage faster.

In order to complete the move, Vodafone will also have to beat off advances from India's Reliance Communications -- the country's second-largest mobile phone firm -- and the Hinduja group, with interests ranging from oil to banking, in taking control of Hutchison Essar.

Vodafone Group PLC's share price was at 149.25 pence at the close of trading on Friday on the London Stock Exchange, close to its highest price since November 2005, which it reached on Wednesday at 150.75 pence.