Spanish telecommunications company Telefonica SA has expressed interest in purchasing AT&T's pay TV assets in Latin America. People familiar with the matter value AT&T's Latin American pay TV assets at up to $10 billion.

AT&T gained the Latin American properties after purchasing them in their acquisition of DirecTV last year, Reuters reports.

DirecTV Acquisition Gives AT&T Presence in Latin America

AT&T now has satellite and cable operations in Brazil, Colombia, Venezuela, Argentina and several other countries in Latin America.

The company still must decide if they are willing to part with the Latin American assets. AT&T is weighing the benefits of making a deal with Telefonica or another company.

A Multiple-Company Sale Is Possible

Other companies are interested in AT&T's pay TV assets in specific countries in Latin America too. Instead of making a deal for all of the assets solely with Telefonica, AT&T could end up splitting up the properties, selling them off individually to multiple companies, according to a source familiar with the matter. The source added that one potential buyer could be Liberty Global Plc.

Sources on the story have asked to remain anonymous because the deliberations are confidential.

AT&T has approximately 19 million pay TV customers in Central and South America, which makes the company the biggest pay TV provider in the region. However, due to declining currencies in Brazil and other Latin American countries, profits for the service have sunk.

AT&T's Chief Executive Randall Stephenson said that they would consider selling the Latin American business, but that company officials are willing to be patient.

Telefonica has a major presence in Latin America in the wireless industry. Movistar and Vivo are the company's two major brands, but its pay TV operations in the region are smaller.

AT&T also has a huge ownership in Sky Brasil (93 percent), the largest satellite provider in the country. AT&T also owns PanAmericana, which offers satellite TV from DirecTV in most of the rest of South America, as well as Puerto Rico.

Telefonica's Debt Problem

Telefonica is carrying a debt load of about 50 billion euros ($54 billion). The company is looking to make changes and has been shuffling around its businesses. Telefonica plans to sell off its Spanish infrastructure unit later this year, including wireless towers.