MADRID (Reuters) - Spanish telecoms company Telefonica has hired Citi as an adviser to sell its Chilean business, news website El Confidencial reported on Monday, citing unidentified market sources.

Telefonica would book a capital loss on the sale, the news website added.

Telefonica has withdrawn from many markets in Spanish-speaking Latin American countries where returns were lower than capital cost, opting to focus on Spain, Brazil, Britain and Germany.

The company last month agreed to sell its Peruvian operation at a fraction of its acquisition price 30 years ago.