In an important step toward expanding its business in the world's second largest mobile phone market, Vodafone Group PLC said Tuesday it has agreed to acquire a 10 percent stake in Japan Telecom Co. from AT&T Corp. of the United States for 157.1 billion yen.

Through the new deal, the British cellular phone giant will become Japan Telecom's top stockholder with a stake of 25 percent.

Vodafone had earlier clinched a deal to purchase a 15 percent stake in Japan Telecom from West Japan Railway Co. and Central Japan Railway Co.