Acquisition Agreement

Telefonica SA
2 December 1999


TELEFONICA MEDIA AGREES THE ACQUISITION OF ARGENTINA'S TELEVISION FEDERAL
(TELEFE) AND RADIOCONTINENTAL

The Telefonica Group's company, Telefonica Media, responsible for the Group's
media assets, has reached a memorandum of understanding (MOU) to acquire 100% of
the  Argentine television station Telefe and Radio Continental AM and FM.  The
agreement also includes  the control of a network of television channels that
broadcast throughout Argentina (Cordoba's channel  8, Neuquen's channel  7,
Rosario's  channel 5, Bahfa Blanca's channel 9, Santa Fe's channel 13, Mar de
Plata's channel 8 and Salta's channel 11).

This  MOU  was  ratified in Buenos Aires on November 30th by Telefonica Media's
Chairman  and  CEO Jose  Antonio Rios and  Atco's (Atlantida Communicaciones)
managing director, Constancio Vigil who represented this company and the  North
American investment fund CEI Citicorp.

Jose Antonio Rios has stressed the importance of the  acquisition of these
Argentine audiovisual media companies, as this operation launches Telefonica,
Media in the Latin American audiovisual market.

Telefonica Media and Atco's legal teams are presently drawing  up  the final
version of the selling and purchasing agreement. This operation is awaiting
approval by the corresponding authorities.