Indebted Spanish telco Telefonica has agreed to sell its call centre subsidiary Atento to US PE firm Bain Capital for €1bn (US$1.3bn).
Telefonica, which has €57bn of debt, said it sold the business to increase its “financial…
Indebted Spanish telco Telefonica has agreed to sell its call centre subsidiary Atento to US PE firm Bain Capital for €1bn (US$1.3bn).
Telefonica, which has €57bn of debt, said it sold the business to increase its “financial flexibility”.
TelecomFinance understands that Morgan Stanley advised Telefonica on the deal, and that Bain is financing the deal through three packages of financing with three separate syndicates of Spanish, Brazilian and Mexican banks respectively.
The enterprise value Bain is paying includes a €110m contingent deferred payment and Telefonica will provide Bain with €110m of vendor financing provided by Telefonica.
As part of the agreement Atento has signed on to be a service provider to Telefonica for nine years and the Spanish telco will remain the business’ biggest client.
The deal marks Bain’s first investment in Spain and Latin America. In 2009 the firm acquired Bellsystems24, Japan’s largest call centre company, from Citigroup.
Atento is the second largest call centre business in the world, with revenues of €1.8bn in 2011 and OIBDA of €161m, Telefonica said.
Last year 84% of Atento’s revenue was generated in Latin America.
Telefonica had been looking to offload Atento for some time. In 2011 it cancelled a planned IPO for the unit citing unfavourable market conditions.
In March this year, TelecomFinance reported that Telefonica had hired banks to reassess the market appetite for Atento.
Reports suggesting a fee of around €1bn surfaced at the beginning of the summer with Bain touted as a potential suitor.
The Spanish telco expects the deal to close by the end of the year, subject to regulatory approval.
