Telefonica SA (TEF) said Friday it continues to negotiate with Telecom Italia SpA (TI) on a price for the Italian company's German broadband unit Hansenet.

"We are interested, but no agreement has been made on price," Telefonica's European head Matthew Key said Friday in a meeting with analysts.

Telefonica is Europe's largest telecommunications company by market value.

Hansenet had 2.34 million broadband customers at the end of 2008 in Germany, and is worth around EUR1.1 billion, according to analysts' estimates.

Telecom Italia is selling Hansenet as part of a plan to dispose of non-core assets and says it has received expression of interest from several European telecommunications companies.

Company Web site: www.telefonica.com

-By Jason Sinclair, Dow Jones Newswires, 34 913958127, jason.sinclair@dowjones.com