BellSouth cellular operators

Telefonica SA
12 January 2005



                         NOTICE OF SIGNIFICANT EVENT


In compliance with article 82 of Spanish Securities Market Law 24/1988, and
related provisions, and in order to make it public as the notification of a
Significant Event, Telefonica hereby informs that on January 11th, its
subsidiary Telefonica Moviles, S.A., after obtaining the necessary permission
from the respective authorities, has completed the acquisition of BellSouth
Argentine.



With new purchase Telefonica Moviles completes the acquisition of all
Bellsouth's operators in Latin America



Telefonica Moviles has acquired the Argentinean  operator for an enterprise
value of 988 million dollars.



We attach to this official statement press release announced to the media.





PRESS RELEASE



11/01/2005



TELEFONICA MOVILES COMPLETES ACQUISITION OF ALL BELLSOUTH'S OPERATORS IN
LATIN AMERICA, WITH PURCHASE OF MOVICOM IN ARGENTINA





•        With the purchase of Movicom, for an enterprise value of 988 million
dollars, Telefonica Moviles has completed, in record time, the acquisition of
BellSouth's ten Latin American cellular operators for a total enterprise value
of 5,850 million dollars.



•        The transaction makes Telefonica Moviles the world's second-largest
multinational mobile company, with approximately 72 million managed customers
(figures at the end of the third quarter of 2004) and the biggest in Latin
America, with over 50.6 million managed customers in the region.



•        By combining the operations of Movicom and Unifon, Telefonica Moviles
becomes the leading mobile operator in Argentina (with 5.5 million customers at
the end of 2004) and is in an excellent position to capture a significant part
of the high growth potential in the Argentine cellular market.





Madrid, 11 January 2005.- Telefonica Moviles, the company that manages all the
Telefonica Group's cellular assets, has completed the acquisition of all of
BellSouth's mobile operators in Latin America with the purchase of 100% of
Movicom, BellSouth's wireless operator in Argentina, for an enterprise value of
988 million dollars. The transaction was carried out after obtaining the
necessary approval from the Argentine authorities and in compliance with the
prevailing regulations on spectrum in Argentina.



 'This acquisition marks a further step in the Telefonica Group's commitment to
Argentina. At the same time, receiving definitive approval for the acquisition
of Movicom enables Telefonica Moviles to make additional investments of around
400 million pesos in infrastructure in Argentina in 2005,' said Antonio
Viana-Baptista, Chairman and CEO of Telefonica Moviles. 'The combination of
Unifon and Movicom should bring out the best of both companies and give rise to
an operator that actively helps to develop Argentina's mobile communications.
Customers will have access to the most developed products in the world thanks to
the experience and leadership of Telefonica Moviles, the largest wireless
operator in Argentina and Latin America and the second-largest mobile telephony
multinational in the world.'





The operator acquired



Movicom ended 2004 with 2.15 million customers. Adding together the operations
of Movicom and Unifon, Telefonica Moviles' operator in Argentina, would give the
Telefonica Moviles Group some 5.5 million customers at the end of 2004, making
it the clear leader in the Argentine market.



The Telefonica Moviles Group is now in an excellent position to capture a
significant part of the high growth potential of the Argentine cellular market.



Telefonica Moviles will assume the management of Movicom as of today and will
maintain (as with Unifon) its brand name and commercial systems during a
transition period, until the company's commercial platforms are integrated into
those of the Telefonica Moviles Group.



Eduardo Caride is the Regional Director of  Telefonica Moviles' operations in
the Southern Cone (Argentina, Chile and Uruguay), while Federico Rava, up to now
General Manager of Movicom BellSouth, has been appointed CEO of Telefonica
Moviles' new integrated operations in Argentina.



Unifon and Movicom customers can rest assured that they will keep their current
benefits, telephone numbers, price plans and commercial terms with no changes
whatsoever.



The global agreement with BellSouth



With the acquisition of Movicom, Telefonica Moviles has completed the
acquisition of  BellSouth's ten Latin American cellular operators, pursuant to
the agreement reached by the Telefonica Group and BellSouth on March 5, 2004.



At the end of the third quarter of 2004 (period ending in August) these ten
operators (in Venezuela, Colombia, Argentina, Chile, Ecuador, Panama, Peru,
Guatemala, Uruguay and Nicaragua) had 13.1 million customers,  with combined
revenues of  2,282 million dollars and EBITDA of 741 million dollars at the end
of the third quarter of 2004.



The acquisitions have been made in record time and the transaction values 100%
of the companies (firm value) at 5,850 million dollars, to be financed with
Telefonica Moviles' cash flow and debt.



The transaction makes Telefonica Moviles the world's second-biggest
multinational cellular company, with more than 72 million managed customers
(figures at the end of the third quarter of 2004) and the largest mobile
operator in Latin America, with over 50.6 million managed customers. In
addition, it is the only mobile telephony company operating in all the region's
key markets, which together have over 421 million inhabitants. This leaves the
company better positioned to leverage the strong growth potential of the Latin
American market.





Telefonica Moviles



Telefonica Moviles manages all the Telefonica Group's cellular assets worldwide.
It is one of the world's largest mobile telephony operators and the leader in
the Spanish- and Portuguese-speaking markets. It has operations on three
continents and a managed customer base of around 72 million (at the end of the
third quarter of 2004) including those of BellSouth's Latin American operators,
whose acquisition was agreed in March, 2004. In 2003, Telefonica Moviles
reported operating revenues of 10,070 million euros (+10.2%), EBITDA of 4,463
million euros (+19.5%) and net profit of 1,608 million euros. Telefonica Moviles
is a founding member of the European mobile operators' alliance, FreeMove.



Telefonica Moviles' shares are traded on the Spanish and New York Stock
Exchanges with the ticker TEM.  For more information visit our website:
www.telefonicamoviles.com



Telefonica Group



The Telefonica Group is one of the world's leading telecommunications companies.
Telefonica is the leading operator in the Spanish- and Portuguese-speaking
markets and the sixth biggest operator in the world by market capitalisation.
Its activities are centred mainly on the fixed and mobile telephony businesses,
with broadband as the key tool for the development of both of these. The company
has a significant presence in 16 countries and has operations in approximately
40. Telefonica has a strong presence in Latin America, where the company
operates in eight countries and has a clear growth strategy. Its customer base
amounts to more than 115 million worldwide.







(NOTE: Data for BellSouth for the first three quarters of 2004 correspond to the
period ending 31 August).






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