BellSouth cellular operators

Telefonica SA
28 October 2004

                         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, S.A. hereby informs that its subsidiary
Telefonica Moviles, S.A., after obtaining the necessary permission from the
countries' respective authorities, has completed the acquisition of 100% of
BellSouth's cellular operators in Colombia, Peru, Nicaragua, Uruguay and
Venezuela.

These acquisitions mark the close of the second stage of acquisitions as
contemplated in the agreement reached between the Telefonica Group and
BellSouth, after the acquisition of 100% of Bellsouth's operators in Ecuador,
Panama and Guatemala last October 14th (significant event dated October 14th,
2004). Telefonica Moviles expects to acquire the rest of the operators
(Argentina and Chile) during the course of 2004.

Telefonica Moviles has acquired five operators with an enterprise value of 2,665
million dollars, after receiving the regulatory approval from the relevant
authorities in each country. Telefonica Moviles has completed the acquisition to
BellSouth and has reached agreements with the minority shareholders of the
different operators in order to obtain the 100% of the companies in Colombia,
Nicaragua, Uruguay and Venezuela, and 97.43% of the Peruvian operator, with the
remaining 2.57% still publicly traded.

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





Madrid, October 28th 2004


Press Release


TELEFONICA MOVILES COMPLETES THE ACQUISITION OF BELLSOUTH'S CELLULAR
OPERATORS IN VENEZUELA,  COLOMBIA, NICARAGUA, PERU AND URUGUAY

•   These acquisitions, which have a combined enterprise value of 2,665 million 
    dollars, complete the second phase of the agreement reached between the
    Telefonica Group and Bellsouth, by which Telefonica Moviles is to purchase
    Bellsouth's mobile telephony assets in 10 Latin American countries, for a
    maximum enterprise value of 5,850 million dollars.

•   Telefonica Moviles has now completed the purchases of eight of the 10
    operators, adding the ones closed today to those in  Ecuador, Panama and
    Guatemala, which were acquired on October 14. The enterprise value of the 
    eight operators acquired to date is 4,330 million dollars.

•   Telefonica Moviles expects the remaining acquisitions (Argentina and
    Chile) to be completed by year-end.


Madrid, 28 October 2004.- Telefonica Moviles, the company in charge of managing
all Telefonica Group's cellular assets, has completed the acquisition of
BellSouth's cellular operators in Colombia, Nicaragua, Peru, Uruguay and
Venezuela.

These acquisitions mark the conclusion of the second stage of the purchases
envisaged in the agreement reached between the Telefonica Group and BellSouth on
8 March this year whereby Telefonica Moviles is to acquire all BellSouth's
cellular assets in Latin America, which comprised some 12.5 million customers in
10 countries at the end of the first semester of 2004.

Together with the acquisition of Bellsouth's cellular operators in Ecuador,
Guatemala and Panama on 14 October, Telefonica Moviles has now completed the
acquisition of eight of the 10 operators.

The Company expects to complete the remaining acquisitions (in Argentina and
Chile) over the course of 2004, subject to the receipt of the appropriate
approvals by the regulatory authorities in those countries.

'The acquisition of these five companies brings us one step closer to our target
of completing the purchases of all 10 operators in 2004. We trust that we will
be able to resolve all pending issues and obtain regulatory approval in
Argentina and Chile in order to complete our planned investments in those
countries,' said Antonio Viana-Baptista, Chairman and CEO of Telefonica Moviles.
'The operators acquired have positive earnings and operating indicators. Now
within the fold of the Telefonica Moviles Group, their goal is to capture a good
share of the significant growth potential that exists for mobile telephony in
their respective countries'.


The operators acquired.

Telefonica Moviles has acquired five operators with an enterprise value of 2,665
million dollars, after receiving the regulatory approval from the relevant
authorities in each country. Telefonica Moviles has acquired 100% of the
companies in Colombia, Nicaragua, Uruguay and Venezuela, and 97.43% of the
Peruvian operator, with the remaining 2.57% still publicly traded.


Venezuela

Telefonica Moviles is now market leader in Venezuela, with over 3.9 million
customers at the end of the third quarter of 2004, in a market of 25 million
inhabitants with an estimated penetration rate of 29%.

Telefonica Moviles has acquired 78.2% of the company from Bellsouth. It will
acquire the remaining 21.8% as soon as BellSouth finalises the purchase process
for the stake, which is expected soon. The enterprise value of 100% of the
Venezuelan operator is 1,195 million dollars.


Colombia

Telefonica Moviles has acquired the second largest Colombian operator, with over
2.64 million customers at the end of the third quarter of 2004 in a market of
44.5 million inhabitants with an estimated penetration rate of 14%.

Telefonica Moviles acquired 77.6% of the company  from BellSouth, while Grupo
Bavaria participated in this agreement to sell Telefonica Moviles the remaining
22.4%. The total enterprise value for the Colombian operator is 1,050 million
dollars.


Peru

The combination of the existing operations of Telefonica Moviles Peru and
BellSouth Peru, means Telefonica Moviles would have had over 2.7 million
customers in Peru at the close of the third quarter of  2004, in a market of
over 27.3 million inhabitants with an estimated penetration rate of 18%.

Telefonica Moviles has acquired 97.43% of the company from Bellsouth. The 2.57%
outstanding will continue to be publicly listed. The total enterprise value of
the company is 210 million dollars.


Nicaragua

Telefonica Moviles is now market leader in Nicaragua, acquiring an operator with
over 254,000 customers at the end of the third quarter of 2004 in a market of
over 5.5 million inhabitants, with an estimated penetration rate of 7.8%.

Telefonica Moviles has acquired 100% of the company from Bellsouth. The total
enterprise value for the Nicaraguan operator is 150 million dollars.


Uruguay

Telefonica Moviles becomes the second-ranked operator in Uruguay, with over
172,000 customers at the end of the third quarter of 2004, in a market of over
3.2 million inhabitants with and an estimated penetration rate of 14%.

Telefonica Moviles has acquired 68% of the company from Bellsouth. Motorola,
which has also participated in this agreement, agreed to sell its 32% stake in
the company to Telefonica Moviles.  The total enterprise value for the Uruguayan
operator is 60 million dollars.

The acquisition of the outstanding stakes from the other investors in the
companies acquired (Grupo Bavaria in Colombia and Motorola in Uruguay) will be
carried out at the same valuation as that used in the acquisition of the
BellSouth's stakes. The acquisitions of these stakes are to be completed in the
short term.

Combined, the five operators acquired posted revenues of 1,489 million dollars
and EBITDA of 539 million dollars in 2003.

In the first half of 2004 (ended 31 May 2004), the five operators had revenues
of approximately 885 million dollars and EBITDA of 297 million dollars.

In all, BellSouth's 10 Latin American cellular operators had revenues of 2,501
million dollars and EBITDA of 867 million dollars in 2003.

Telefonica Moviles assumes management of the operators in Venezuela, Colombia,
Nicaragua, Peru and Uruguay as of today. These operators will maintain their
brand names and commercial systems for the time being until their commercial
platforms are integrated into those of  the Telefonica Moviles Group.


The overall agreement with BellSouth

Under the overall agreement reached by Telefonica Group for Telefonica Moviles
to acquire BellSouth's Latin American 10 cellular operators, 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 player, with more than 68 million managed customers
(figures at the end of the first half of 2004) and the largest player in Latin
America, with over 47.5 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
well-positioned to leverage the strong growth potential of the Latin American
market.


Telefonica Moviles

Telefonica Moviles manages all the Telefonica Group's cellular assets in the
world. It is one of the world's largest mobile telephony operators and leader in
the Spanish- and Portuguese-speaking markets. It has operations on three
continents and a managed customer base of over 68 million (at the end of the
first half of 2004) including those of BellSouth's LatAm operators, whose
acquisition was agreed in March this year. In 2003 Telefonica Moviles reported
10,070 million euros of operating revenues (+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 symbol TEM.  For more information visit our website:
www.telefonicamoviles.com


The 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 largest operator in the world in terms of market
capitalisation. Its activities are centered 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 where it concentrates
its growth strategy. Its customer base amounts to more than 100 million clients.

Telefonica is a 100% private company, with almost 1.7 million direct
shareholders. Its share capital currently comprises 4,955,891,361 ordinary
shares traded on the Spanish Stock Market (Madrid, Barcelona, Bilbao and
Valencia) and on those in London, Paris, Frankfurt, Tokyo, New York, Lima,
Buenos Aires, Sao Paulo and the SEAQ International Exchange in London.


Further information on http://www.telefonicamoviles.com


Direccion de Division de Comunicacion                      Tel: [phone]

Paseo de Recoletos, 7 y 9                                  Fax: [phone]

28004 Madrid                             e-mail: [e-mail]


(NOTE: Data for BellSouth at the end of 2003 correspond to the period ended 30
November. Data for BellSouth for the third quarter of 2004 correspond to the
period ending in August.)


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