Telefonica is reportedly close to selling its Spanish call centre Atento to US-based private equity firm Bain Capital.
The Spanish telecoms group, which today announced it would scrap its dividend payment and share buyback programme for the year, and…
Telefonica is reportedly close to selling its Spanish call centre Atento to US-based private equity firm Bain Capital.
The Spanish telecoms group, which today announced it would scrap its dividend payment and share buyback programme for the year, and Bain are working on the details of a deal valuing Atento at about €700m ($846m), Bloomberg reported, citing unidentified sources familiar with the matter.
An agreement may be announced this week, the report stated, although another unidentified source said European private equity firm Permira is still in talks with Telefonica about Atento.
Announcing its half year results today, Telefonica said it hopes to raise at least €1.5bn (US$1.8bn) from the sale of assets – including Atento, PT, Rumbo and non-strategic towers – to help reduce debt of about €57bn.
Earlier this month, Telefonica disclosed that it was evaluating several offers for the call centre business.
The sale forms part of the group’s comprehensive strategy to cut debt and improve liquidity. In the past two months, Telefonica has announced intentions to list its German unit, 02 Germany, said it is considering doing the same with some of its Latin American businesses and halved its stake in China Unicom.
Telefonica today described its decision to suspend its dividend and share buyback programme as “an exceptional protective measure against the tough and exogenous economic and market conditions”. The company noted that this, together with its non-strategic asset divestment programme and portfolio management will allow it to reduce its total net debt to below x2.35 OIBA by the end of the year.
Telefonica reported revenue of €30.98bn for the first half of 2012, with consolidated OIBDA of €10.431bn and an OIBDA margin of 33.7%. Net profit stood at €2.075bn, €1.327bn of which was earned in the second quarter. The company said its Latin American operations continue to drive growth, contributing 48% of its consolidated revenue and accounting for 50% of OIBDA. In Europe, the company’s German unit performed the best, achieving growth across all main financial areas.
“In the first half of 2012, Telefonica’s results were significantly impacted by the difficult trading environment in key countries, including adverse economic conditions, intense competition and the negative effects of regulation,” the company said. “Against this backdrop, the company’s highly-diversified portfolio and the increasing contribution of Latin America and Germany, where solid growth is maintained, are the key levers to offset the performance of the rest of Europe.”
A Telefonica spokesperson declined to comment further on Atento.
