By Christopher Bjork

MADRID--Spain's Telefonica SA (TEF) said Friday it had completed a 3.05 billion euros ($3.28 billion) rights issue to fund the acquisition of Brazilian broadband operator GVT from France's Vivendi SA (VIV.FR).

The Madrid-based phone operator sold just over 281 million shares in a rights issue, it said in a regulatory filing. The proceeds from the sale will be used to subscribe to a separate capital increase by Telefonica's Brazilian unit, which is taking over GVT in a EUR7.24 billion cash and stock deal.

Telefonica agreed last September to pay Vivendi EUR4.66 billion in cash as well as shares in Telefonica Brasil (VIVT4.BR) and in Telecom Italia SpA (TI) in exchange for GVT.

The acquisition of GVT bolsters Telefonica's position as the leading telecommunications firm in Brazil, Latin America's biggest economy, adding mostly broadband and cable customers.

Write to Christopher Bjork at christopher.bjork@wsj.com

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