Australia's Telstra has bought Hong Kong's largest mobile phone firm for 1.1bn Australian dollars (US$ 614m; �400m).

Telstra bought the remaining 40% stake in CSL from Hong Kong's telecoms giant, Pacific Century Cyberworks (PCCW).

The deal terminates the two telecoms firms' wireless partnership, which targeted joint expansion throughout the region.

PCCW admitted the deal was about trying to reduce its US$5bn debt mountain.

Mike Butcher, PCCW's chief operating officer, said the markets were now more worried about financial fundaments rather than growth prospects.

Spearheading growth

Telecoms firms ran up massive debts during a period of intense expansion at the height of the telecoms boom.

And PCCW has been struggling under the debt incurred by acquiring Hong Kong's former telecom monopoly, Cable & Wireless.

The firm's strategy shift to reduce debt has enabled Telstra to pick up a valuable asset.

"CSL is profitable and debt free, and has a strong reputation in the Asian region," said Telstra chief executive Ziggy Switowski.

"CSL will be a major spearhead for our wireless growth strategy in Asia," he added.

CSL has a subscriber base of 1.1 million, including the biggest share of high-spending business customers.