A unit of the Chinese Cabinet's Citic Group has bought Macau's phone company from its British and Portuguese owners for $1.2 billion.

Citic Telecom International Holdings Ltd. said Monday it would raise its stake in Telecommunicacoes de Macau from 20 percent to 99 percent.

Citic Telecom bought a 51 percent holding from a Hong Kong unit of Cable & Wireless Plc and 28 percent from Portugal Telecom. The remaining 1 percent will be held by Macau's post office.

Citic Telecom said it also signed a three-year agreement with Portugal Telecom to collaborate in telecoms and identify potential investments.

The company, with shares traded in Hong Kong, also has operations in the United States, Brazil, Japan, Taiwan and other Asian markets.