Madrid - The Spanish telecommunications giant Telefonica and its competitor Vodafone announced Monday that they will share mobile phone networks in Spain, Germany, Ireland and Britain.

The two are also discussing possible cooperation in the Czech Republic, the companies told the Spanish stock market regulator CNMV.

The cooperation will save the companies hundreds of millions of euros over a decade, Telefonica and Vodafone said, describing their agreement as "historic" in Europe.

The agreement involves jointly building new sites and consolidating existing 2G and 3G mast sites.

It will reduce the need for antennas, masts and other infrastructure, generating savings and reducing the environmental impact of the networks, Vodafone and Telefonica said in the joint statement.

The savings will allow the companies to invest in improving products and services such as mobile broadband.

In Spain, Telefonica and Vodafone already have a 2007 agreement on the joint use of electricity, equipment and masts, which has allowed them to share 2,200 sites so far.

Telefonica and Vodafone also planning to cooperate in other areas such as transmission services.

Despite the agreement, the two "sector leaders" will "continue competing intensely in all their markets," said Matthew Key, president of Telefonica Europe.