Telefonica sold a 1.5 per cent stake in China Unicom for €322 million, while still holding on to a remaining 1 per cent, as part of its debt management plan.

This deal is part of its “proactive management of its asset portfolio and its mid-term deleveraging objective”, the company said.

The company added that it is committed to a strategic alliance with the Chinese operator signed in 2009, which includes M2M and handset procurement and which was “recently strengthened” via a big data joint venture.

Telefonica started building up the stake after the alliance was signed. In 2011, its stake in the Chinese carrier stood at 9.57 percent but in 2012  it sold half of it, raising $1.4 billion in the process, with the shares purchased by Unicom itself.

Then in 2014, it sold half its remaining stake for $854 million.

Telefonica, with a debt of around €50 billion, had to shelve plans to sell its O2 unit in the UK to CK Hutchison because of EU opposition. In the wake of Brexit-inspired market volatility, the company announced at the end of June that it was no longer looking to dispose of O2, at least for the moment.  Last week there was a report Telefonica is exploring an end-of-year IPO.

Telefonica, described by Bloomberg as the second-most indebted phone company in Europe, is also pursuing other transactions to reduce its  debt pile, notably an IPO for Telxius, its global infrastructure business, which could raise between €4 billion and €5 billion.