On Sunday, China Unicom and Telefonica of Spain expanded their strategic alliance, as each company agreed to purchase equity stakes in each other and to solidify their current cooperative relationship in areas that include network and technology development, the sharing of management and operational expertise, and the provision of services to multinational customers. Telefonica, a 5.5% owner of China Netcom, became a Unicom stakeholder after Unicom merged with Netcom last year as part of a sweeping reorganization of China’s state-owned telecom carriers. Through Sunday’s pact, Unicom and Telefonica will acquire US $1 billion in shares in each other that would boost Telefonica’s current 5.5% Unicom stake to 8.8% and that would give Unicom a 0.9% stake in Telefonica, representing Unicom’s first-ever investment in a European telecom operator. In addition to giving Telefonica a stronger foothold in China against Vodafone of Great Britain (a 3.3% stakeholder in China Mobile), the deal would give Unicom access to markets in Spain, Europe and Latin America that are served by Telefonica. Telefonica Chairman Cesar Alierta praised the agreement as one that would allow “both companies to strengthen their leadership while building a joint client base of around 550 million worldwide.”