Spain's Telefonica dropped the planned listing of its call centre unit Atento on Friday, after failing to drum up sufficient interest even after cutting the offer price.
A source close to the deal said Telefonica received enough demand for 97 percent of the shares on offer, but this included orders from the banks running the deal. On Thursday, Telefonica pushed back the offer period by one day and cut the price to 17.25 euros per share from an initial range of 19.25-25.00 euros.
Telefonica, which is focusing efforts on paying off debt and organic growth as it struggles to retain customers in an increasingly competitive Spanish market, had initially hoped to raise up to 765 million euros ($1.10 billion) from the offering.
Telefonica has for some time wanted to dispose of part of Atento and plans in the longer term to sell the whole company, which is not strategic and has a margin over sales of just over 10 percent compared with 36.7 percent at the group's core business.