Merger deed recording

Telefonica SA
31 July 2006


Further to the significant event released on July 28th, 2006, Telefonica, S.A.
hereby reports that the Public Deed of the Merger by Absorption of Telefonica
Moviles S.A. by Telefonica, S.A. was recorded with the Commercial Registry of
Madrid on July 29th, 2006. The Merger has therefore become effective from that
date and as a result, the shares of Telefonica Moviles have been extinguished.



Madrid, July 31st, 2006


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