US-based NII Holdings is said to be close to selling its Nextel units in Argentina and Chile for US$250m to a group of investors led by Argentine media owners Sergio Szpolski and Matias Garfunkel.
NII’s share price went up more than 10% yesterday…
US-based NII Holdings is said to be close to selling its Nextel units in Argentina and Chile for US$250m to a group of investors led by Argentine media owners Sergio Szpolski and Matias Garfunkel.
NII’s share price went up more than 10% yesterday after La Nacion and Clarin reported that the consortium was nearing a deal, citing sources close to the negotiations.
The LatAm-focused telco hired UBS to look at strategic alternatives in March and put itself up for sale. It also mandated Rothschild to improve its capital structure, which includes US$4.2bn in net debt.
Szpolski and Garfunkel, who own publisher and broadcaster Veintitres, plan to take control of Nextel Argentina and lead it into the country’s long-awaited 3G and 4G auctions later this year. The businessmen are backed by investors from Argentina and the US, and have hired KPMG to conduct due diligence on the two units. NII has mandated the local branch of Citibank to sell the Argentinian business, according to the Clarin report.
NII initially shifted its strategy last year to focus on its core markets of Brazil and Mexico. It put its other operations in Argentina, Chile and Peru on the market, and successfully offloaded the Peruvian business to Entel Chile for US$410m.
However, in March the group decided that more drastic action had to be taken. At the time its CFO Juan Figuereo said NII needed to improve its liquidity position or else it would not be able to meet its financial obligations and fund the business through 2015 and beyond.
NII’s stock was trading at US$2.63 at the start of the year, but has now dropped more than 73% to US$0.69 leaving it with a market capitalisation of US$121m.
