Telefonica sells 4.56 % stake in China Unicom for $1.4 bn
11 Jun 2012
Telefonica today agreed to sell back a 4.56 per cent stake in China Unicom for €1.1 billion ($1.4 billion) as Spain's biggest phone company raises cash to reduce debt that is currently more that its market capitilisation.
The move comes a few weeks after Telefonica, which is also Europe's largest telecom company, said that its board has approved a proposal for an initial public offering for its German subsidiary for O2 Germany, as well as for its 14 businesses in South and Central America.
It is also planning to sell its online booking service Rumbo, and its call centre Atento.
Last month, Standard & Poor's cut the company's rating to the lowest level since it started ranking the debt in 1996.
Under the deal executed yesterday, Telefonica will sell the China Unicom shares to the Chinese carrier's state-owned parent China United Network Communications Group.
Madrid-based Telefónica, which held a near 10-per cent stake in China Unicom, will still hold around 5 per cent stake in China's second-largest mobile phone operator after China Mobile.
