Officials from SouFun declined to comment on the deal, but said it would make an announcement next week.

SouFun, established in 1999, provides information, advertising and listing services to China's growing online real estate and home furnishings and improvement sectors.

Online advertising currently generates about 60 per cent of its total revenue.

Telstra said cash-flow positive SouFun is expected to contribute earnings before interest, tax, depreciation and amortization of A$18 million (US$14 million) in fiscal year 2007.

SouFun founder and CEO Vincent Mo will remain a significant shareholder, while the balance of the stock will be held by management and IDG Venture Capital.

IDG Venture Capital, the investment arm of publisher IDG, and Goldman Sachs were early investors in the company.

Mo and SouFun's original management team will continue to lead the company, while Telstra's Sensis team will add senior representatives with key expertise.

Telstra said earlier this year that it was seeking to expand in China. The company now holds 76 per cent of CSL New World Mobility Ltd, Hong Kong's biggest mobile carrier by subscribers. Telstra also jointly owns Hong Kong's undersea cable operator Reach Ltd with PCCW Ltd.

SouFun, the largest property website in China, draws about 40 million visitors each month. According to Amazon's Internet-traffic rankings site Alexa, SouFun is among the 100 most popular  websites worldwide.

In a separate statement, Paris-based Trader Classified Media said it had sold its stake in SouFun to Telstra for about US$100 million.

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