Spain's heavily indebted Telefonica said Sunday it had sold a 1.51-percent stake in China Unicom, China's second-biggest telecommunications provider, for 322 million euros ($356 million).

The former state monopoly, which has been selling stakes in non-core assets, sold 361.8 million shares in China Unicom at 7.80 Hong Kong dollars per share, Telefonica said in a statement. The operation leaves it in possession of about one percent of China Unicom, it added.

"This operation is part of measures to manage the asset portfolio, and the goal of medium-term deleveraging of the company," Telefonica said.

The Spanish company said it remained committed to its strategic alliance with China Unicom, with which it recently set up a joint venture to sell big data services.

The sale comes after the European Commission in May shot down Telefonica's blockbuster sale of British telecom giant O2 to Hong Kong group Hutchison.

The Spanish carrier has been counting on the 10.3-billion-pound (12.1 billion euro) sale of the O2 unit to reduce its debt pile of 49.9 billion euros.

Telefonica reported net profits in 2015 of 2.75 billion euros, a drop of 8.5 percent over the year partly down to costs associated with voluntary redundancies in Spain.

It is rated two notches above junk by both Moody's Investors Service and Standard & Poor's.