Telefonica SA's (TEF) talks with media conglomerate Promotora de Informaciones SA (PRS.MC), or Prisa, to buy a stake in its TV division Sogecable are going well, Telefonica said Friday.

"We are still interested in a stake in Sogecable, the talks are right on track," Telefonica's Chairman Cesar Alierta said in a meeting with journalists.

Prisa, which is struggling with a debt load of nearly EUR5 billion, is seeking to sell stakes in key assets to improve its finances at a time when the global media industry is facing unprecedented challenges.

Analysts say Telefonica is especially interested in Prisa's pay-satellite TV platform Digital+ that has a sizable customer base and would complement Telefonica's Internet-based pay TV platform, Imagenio.

Sogecable includes Digital+ as well as the free to air channel Cuatro.

Last year, Telefonica teamed up with France's Vivendi SA (VIV.FR) to make a joint bid for Digital+, Telefonica said at the time. Prisa rejected the offer as too low.

The relationship between Telefonica and Vivendi soured after Vivendi made a bid for Brazilian telecom GVT Holding SA (GVTT3.BR) in September, Alierta said.

"We're disappointed with Vivendi," Alierta said. The bid for GVT was "a surprise," he added.

Telefonica made a higher counter-bid for GVT earlier this month.

Telefonica is Spain's largest telecommunications company by market value and customers.

Company Web site: www.telefonica.com

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