Telefonica is widely reported to be preparing to sell some of its shares in China Unicom to raise between US$859m and US$875m.
The Spanish incumbent is offering 597.8 million of its shares in the Chinese giant for between HK$11.14 (US$1.44) and HK$11.34…
Telefonica is widely reported to be preparing to sell some of its shares in China Unicom to raise between US$859m and US$875m.
The Spanish incumbent is offering 597.8 million of its shares in the Chinese giant for between HK$11.14 (US$1.44) and HK$11.34 (US$1.46) each, the reports cited a private term sheet as saying.
Telefonica has mandated Bank of America to sell the stock, which is currently trading at HK$11.48 (US$1.48), the reports said.
Telefonica currently owns 5.01% of China Unicom, which equates to around US$1.76bn. Should the share sell-off prove successful that stake would be roughly cut in half.
Once the Spanish operator sells shares, it is prevented from selling any more for a period of 90 days.
A Telefonica spokesperson declined to comment on the reports.
In July 2012, Telefonica halved its stake in China Unicom, selling 4.56% of China’s second-largest mobile operator to its parent company, China United Network Communication Group, for HK$10.75bn (US$1.39bn).
At the time, Telefonica said it formed “part of the proactive management of its asset portfolio”.
Telefonica and China Unicom established a strategic alliance in 2009 and bought stock in each other’s businesses.
The Spanish operator disclosed net debt of US$53.6bn in its Q2 results and was rated Baa2, BBB and BBB+ by Moody’s, S&P and Fitch respectively. The company is due to announce its Q3 results tomorrow.
