News reports are doing the rounds that if Telstra fails in its initial public offering, then it will sell its big stake in a Chinese realty website to private equity funds.

Today, Australia’s biggest phone Company, Telstra Corp. said that General Atlantic LLC and Apax Partners LLP, together with two shareholders of the website, SouFun Holdings Ltd., will purchase a stake in the corporation, which is being valued at $810 million.

It said that the private equity funds and the shareholders decided to obtain SouFun shares of Telstra, which will not be retailed in the IPO “up to an agreed maximum price”. However, it did not disclose a price.

David Thodey, Telstra’s Chief Executive Officer wants to exceed its expenditure on cell phone services, in order to curtail its waning domestic market share. That is why, the Company is keen to sell its business.

Four years back, ex-CEO of Telstra, Sol Trujillo had purchased 51% of the Chinese Company, for $254 million, in an endeavor to stimulate growth in its domestic market.

Telstra said in a statement, “The transactions among Telstra, the private equity firms and the existing SouFun shareholders are subject to certain closing conditions”.

The plans for an IPO for SouFun were declared by the Company, in December.