Telefonica said it would raise up to 3 billion euros ($3.4 billion) through a rights issue in connection with the acquisition of Vivendi's Brazilian unit GVT in a deal announced last year.
Europe's biggest telecoms group by revenue reported a 35 percent fall in its annual net profit to 3.0 billion euros, while operating income fell 19 percent to 15.52 billion euros, with both results slightly missing forecasts.
Telefonica had already warned last week that the devaluation of the bolivar would knock 399 million euros off its net profit.
Revenue stabilised in its key home market, where it has been trying to win back cash-strapped consumers with bundled packages of mobile, fixed-line broadband and TV services after investing heavily in faster networks.
Net debt was 45.1 billion euros at the end of December above a year-end target of 43 billion euros due to the weakening of the Venezuelan bolivar, the company said.
Seeking to cut its debt and concentrate new investment on core markets in Spain, Germany and Brazil, Telefonica has already sold subsidiaries in Ireland and the Czech Republic and agreed last month to sell its British O2 business to Hutchison Whampoa for up to 10.25 billion pounds ($15.9 billion).
Provided the deal gets approved, cash from the sale will help the Spanish group cut debt to about 35 billion euros according to analysts' estimates, helping sustain one of the highest dividend yields in the sector at 5.4 percent, according to Thomson Reuters data.
The company said it aimed to reduce its net debt to operating income ratio to 2.35 in 2015 from 2.74 at end 2014. The 2014 ratio does not include proceeds from the O2 sale.