­It has been revealed that Telefonica's German subsidiary made a a payment of EUR4.3 billion (US$5.5 billion) to its indebted parent company just before its stock market floatation.

Citing documents shown to banks involved in the IPO, Bloomberg News reported that the dividend payment was made last month. The company is looking to sell a minority stake of 20-30 percent in the German company by the end of this year.

Telefonica has also cancelled a capital promise worth EUR2.9 billion to the company, which will be floated with a net debt of EUR1.2 billion.

Telefonica is currently battling to reduce its debt in the face of another debt ratings downgrade to just above junk status.

In other news, Telefonica has also today announced the sale of its CRM division, Atento to the private equity group, Bain Capital. The enterprise value of the transaction amounts to EUR1.04 billion, including EUR110 million of a contingent deferred payment and vendor financing provided by Telefónica for an amount of EUR110 million.