The UK telecoms giant has struck an agreement to offload part of BT Spain to Portobello Capital, though will hold onto part of the operations in order to serve its global customers.
BT will split the Spanish business in two over the coming five or six months, according to the Cinco Dias arm of daily El Pais.
With a huge debt pile and a need to roll out its domestic fibre broadband network, the FTSE 100 group has been looking to sell non-core assets and cut costs and capital expenditure, admitting this summer it has also been pondering potentially cutting its dividend.
It put its operations in Spain, Ireland and the Netherlands on the block during the early summer, with local reports suggesting there had been interest from domestic telecoms players and investment funds.
Last year the Madrid-based arm saw revenue fall 2% to €328mln and pre-tax profit drop 4% to below £10mln amid stiff competition.
BT shares were up 8% to 205.05p on Friday morning, helped by the lifting of the overhang from worries about the UK election.