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MADRID, March 26 (Reuters) - Trading in shares of Spain’s Telefonica were suspended on Tuesday morning after Europe’s biggest telecoms operator by revenue said it would sell all of its treasury stock in a push to reduce debt.
The trading suspension would be lifted at 0900 GMT, the regulator said in a statement. Telefonica declined to comment on the share suspension.
The sale of treasury stock, equivalent to 2 percent of the company’s capital, will be carried out via an accelerated bookbuilding process and will not take more than a day, Telefonica said after the market closed on Monday.
“Assuming a 5 percent discount versus yesterday’s closing price ... the company could raise 962 million euros ($1.24 billion), representing 22.4 percent of Telefonica’s total debt-reduction target in 2013,” Sabadell said in an investors note.
Telefonica shares closed at 11.2 euros on Monday.
The carrier, which has been battling recession for over a year in one of the euro zone’s worst hit economies, aims to cut debt to less than 47 billion euros by the end of the year from more than 51 billion euros at the end of 2012.
The group has been shedding assets in the battle against its debt load, selling part of its stake in China Unicom and its call centre business Atento last year and is expected to sell a number of smaller assets this year. ($1 = 0.7763 euros) (Reporting By Sarah Morris and Paul Day; Additional reporting by Jose Elias Rodriguez; Editing by David Goodman)