US-based NII Holdings has reached a debt-for-equity swap agreement with its creditors, which include Aurelius Capital Management, Capital Research and Management and American Tower.
The telecoms holding, which operates under the Nextel brand in Brazil,…
US-based NII Holdings has reached a debt-for-equity swap agreement with its creditors, which include Aurelius Capital Management, Capital Research and Management and American Tower.
The telecoms holding, which operates under the Nextel brand in Brazil, Mexico and Argentina, filed for bankruptcy protection in mid-September after failing to meet its debt obligations.
Under the plan, which is subject to bankruptcy court’s approval by 8 April 2015, US$4.35bn of the company’s unsecured notes would be converted into equity, according to a securities filing.
The restructured entity would receive US$500m in new capital, consisting of a US$250m rights offering backstopped by Aurelius and Capital Research and US$250m in debt financing.
The proposal would also involve the settlement of “certain complex intercompany and inter-creditor disputes”.
The plan values NII Holdings at US$2.42bn, the company said in the filing.
“After months of hard work, we are pleased to announce an agreement on the key terms of a reorganisation plan that provides a path for the company to emerge from bankruptcy in a healthy financial position to effectively compete in the wireless marketplace,” NII Holdings CEO Steve Shindler said.
Earlier this month, Nextel Mexico, which ranks fourth among the country’s mobile carriers with a 2.8 million subscriber base, attracted interest from AT&T, which recently agreed to buy number three Iusacell for US$2.5bn.
In August, NII sold its Chilean operations to Fucata, a joint venture between Argentine media group Grupo Veintitres, British investment firm ISM Capital and US private equity firm Optimum Advisors.
Fucata is also reportedly in talks to buy Nextel Argentina.
