MOBILE phone group Vodafone yesterday warned that its assets were overvalued by as much as £28bn and its revenues growth was likely to slow.

Vodafone announced it was taking a hit of between £23bn and £28bn on the value of its operations in Germany, Italy and possibly Japan.

The bulk of the impairment of its goodwill related to its operations in Germany, which Vodafone acquired in a deal for Mannesmann, in 2000.

Vodafone blamed "an increasingly competitive environment in the industry" and pointed out that share prices in the telecoms sector were significantly higher at the time of the Mannesmann deal than they are today.

The tough operating conditions were a major reason why Vodafone predicted mobile revenues growth, excluding acquisitions and disposals, of between five per cent and 6.5 per cent in the year to March 31 next year.

That is lower than the range of six per cent to nine per cent it expects for this financial year.

Vodafone also blamed tougher regulation, which has seen cuts to termination rates - the price that mobile phone firms charge each other and landline operators for putting callers through to their customers.

Earnings before interest, tax, depreciation and amortisation -excluding Japan - were expected to fall by about one per cent in the next financial year, the company said.

Vodafone shares slumped six per cent to their lowest level for three years, despite the group assuring investors that its outlook for this financial year remained unchanged.

Analysts, who believe the write-off to be one of the biggest in British corporate history, have been critical of Vodafone's performance in recent months and noted that its position had changed since the interim results in November.

Daniel Krimholtz, telecoms expert at Barclays Stockbrokers, said pressure was growing on chief executive Arun Sarin to provide some more positive news on dividends and its positions in Japan and Verizon Wireless.