UPDATE 1-Telefonica's Atento sale to cut debt by $1 billion

Wed Dec 12, 2012 12:34pm EST

* Closes sale of Atento to Bain for 1 billion euros

* Deal will cut debt by 812 million euros

* Further debt reductions seen as deferred payments flow in (Adds debt position)

MADRID, Dec 12 (Reuters) - Telefonica said the sale of its Atento call centre business will cut debt by 812 million euros ($1 billion) this year, helping the telecoms operator in its drive to reduce borrowings and save its credit rating.

Telefonica, which has been selling assets in a move to please credit rating agencies worried about its high debt, closed the sale of Atento on Wednesday to U.S. private equity firm Bain Capital for an enterprise value of 1.05 billion euros.

The Atento sale, announced earlier on Wednesday, included 110 million euros in financing from Telefonica and 110 million euros in deferred payments, which the Spanish telecoms firm said would further help its debt position in coming quarters.

Telefonica, suffering a revenue slowdown in its recession-hit home market, has pledged to reduce debt to about 50 billion euros by the end of this year from 56 billion at end-September to meet a leverage target of 2.35 times operating income.

Aside from selling part of its stake in China Unicom and online travel agency Rumbo, Telefonica has also listed part of its German unit and said it is considering floating up to 15 percent of its Latin American arm to further reduce debt. ($1 = 0.7669 euros) (Reporting By Tracy Rucinski; editing by Clare Kane and Keiron Henderson)