Telefonica scraps Latin America flotation plans - report

MADRID Mon Feb 11, 2013 6:18am EST

MADRID Feb 11 (Reuters) - Telefonica has scrapped plans to float its Latin American businesses, Spanish online newspaper El Confidencial reported on Monday, citing sources close to the company's board.

Europe's largest telecoms company by revenue was not happy with the implied valuation of the assets, the report said.

A spokesman for Telefonica declined comment on the report.

The company, which reports results on Feb. 28, expects to have slashed debt to about 50 billion euros ($67 billion) at the end of 2012 from more than 58 billion at the end of June.

Keen to slash debt to hold onto its prized investment grade rating, Telefonica had set a leverage target of under 2.35 times EBITDA earnings for end-2012.

Banesto Bolsa analysts said asset sales last year, including part of its stake in China Unicom, meant it had already hit that target. Floating its Latin American businesses would have raised up to 6 billion euros.

Telefonica shares were barely moved at 10 euros by 1117 GMT. ($1 = 0.7474 euros) (Reporting by Clare Kane; Additional reporting by Robert Hetz; Editing by Louise Ireland)

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