S&P gives Telefonica hybrids BB+

S&P said it assigned a BB+ long-term issue rating to the proposed hybrid notes to be issued by Telefonica Europe BV and guaranteed by Telefonica SA (BBB/stable/A-2).

The size of the issue is expected to amount to €1 billion.

The agency said it classifies the proposed hybrids as having intermediate equity content until the first reset date because they meet the criteria in terms of their subordination, permanence and optional deferability during this period.

S&P said the rating considers a view that there is a relatively low likelihood that Telefonica Europe will defer interest payments.

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