Malaysia's biggest telecommunication operator said Friday its wholly-owned unit will buy a 49 percent stake in Spice Telecom Ltd. to give it an foothold in the sought-after Indian market.

Telekom Malaysia (TM) will pay US$178.8 million to acquire holding company Distacom Communications, which has a 49 percent stake in Spice Telecom, the company said in a statement to the stock exchange.

The company's TM International unit has refocused its international investments on regional markets closer to Malaysia, the company said. The Spice acquisition provides "an opportunity to enter the lucrative Indian telecommunications market," it said.

1.5 million subscribers

"This will strengthen TM's regional presence as well as complement its existing operations in countries such as Sri Lanka and Bangladesh," the company said, adding that it hopes to build a leading cellular company in India.

Spice operates in the northern Indian state of Punjab and the southern state of Karnataka and has more than 1.5 million subscribers.

Telekom Malaysia and rival Maxis Communications, Malaysia's biggest mobile-phone company, are offering more services and expanding to lucrative overseas markets in response to rising competition in the domestic market.