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Telefonica Pulls Sale of O2 as Brexit Foils Debt Cut Plans

  • Carrier to consider options amid roiling post-Brexit markets
  • Company comments on U.K. unit in Spanish regulatory filing
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Telefonica SA shelved plans to sell a stake in its wireless carrier O2, as Britain’s decision to leave the European Union roiled markets and created a final, insurmountable hurdle to a 15-month sales effort aimed at cutting debt.

Telefonica was weighing options for the U.K. unit including an initial public offering after the EU blocked its 10.25 billion-pound ($13.8 billion) sale last month, people familiar with the matter have said. Instead it will consolidate O2 back into its financial statements, and no longer present the unit as discontinued operations, according to a regulatory filing Wednesday.