Stmnt re Capital Increase

Telefonica SA
26 January 2001


                              TELEFONICA MOVILES

Mr Antonio Hornedo Muguiro, Vice Secretary, non member of the Board of
TELEFONICA MOVILES, S.A. ('Telefonica Moviles') appears before the Spanish 
National Securities Market Commission ('CNMW') and

                                    DECLARES

That he submits to the CNMW as HECHO RELEVANTE (Significant Event) the following
information regarding the capital increase of the Company.

Telefonica Moviles, S.A. has today executed one of the non-cash contribution
capital increases approved by the Company's General Universal Extraordinary
Shareholders Meeting of October 26th, 2000.

In accordance with the Complete Prospectus registered with the above mentioned
Commission on November 2nd 2000, TELEFONICA MOVILES, S.A. has increased its
share capital by Euros 87,431,682 through the issue of 174,863,364 ordinary
shares which have been subscribed by TELEFONICA, S.A.

The total payment for the shares has been made by TELEFONICA, S.A, through the
contribution of TELEFONICA DE ARGENTINA, S.A. shares, which will permit
TELEFONICA MOVILES, S.A. to become the holder of Argentina's mobile business

It is requested that all the information above be registered with the Spanish
Securities Commission on Madrid, January 25th, 2001.