Subsid's Joint Venture

Telefonica SA
28 March 2000


INCORPORATION OF JOINT VENTURE BETWEEN TERRA NETWORKS, S.A. AND COMPANIA DE
DISTRIBUCION INTEGRAL LOGISTA, S.A.

On March 22nd 2000, TERRA NETWORKS, S.A. reached an agreement with COMPANIA DE
DISTRIBUCION INTEGRAL LOGISTA, S.A. to incorporate a company whose function wil
be that of providing logistic services, such as storage, handling, delivery,
billing and e-fulfilment of products marketed through Internet, to the end-user.

The new company will intially operate throughout Spain, Portugal, France, Latin
America and the U.S.

The Bertelsman Services Group, through its subsidiary in Spain, Total
Distribucion, S.A., may participate in the aforementioned agreement through the
signing to take place prior to March 31st, 2000.

Madrid, March 27th, 2000