US-based NII Holdings has agreed to sell subsidiary Nextel Chile to an international group of investors.
NII, which announced last week that it may have to file for bankruptcy, said in a SEC filing that it entered into a stock purchase agreement with…
US-based NII Holdings has agreed to sell subsidiary Nextel Chile to an international group of investors.
NII, which announced last week that it may have to file for bankruptcy, said in a SEC filing that it entered into a stock purchase agreement with the joint venture, Fucata, on 14 August.
Fucata comprises Argentine media group Grupo Veintitres, British investment firm ISM Capital and US private equity firm Optimum Advisors.
The financial details were not disclosed and NII was not immediately available for further comment.
The Latin America-focused mobile operator said last Tuesday that it will likely be forced to file for Chapter 11 bankruptcy protection because of poor financial performance and an inability to meet debt obligations.
On Friday, NII revealed that it had decided not to pay about US$118.8m in interest due to bondholders that day and entered into a 30-day grace period. The company said it was still in talks with bondholders about restructuring its debt obligations, with options including exchanging some or all of the relevant senior notes for either equity or debt in the reorganised company. However, NII cautioned that “there can be no assurance that these efforts will result in any such agreement”.
According to NII’s latest financial report, Nextel Chile posted revenues of US$16.8m for Q2 2014, segment losses of US$24.5m and net losses of US$154.7m. This June, NII recognised a non-cash asset impairment charge of US$127.5m. As of 30 June, Nextel Chile had total assets of US$33.5m and total liabilities of US$266.2m, of which US$232.7m relate to intercompany liabilities.
NII, which in March hired UBS to look at strategic alternatives for the company including a potential sale, has been facing stiff competition from Carlos Slim’s America Movil and Telefonica in Chile but also in Argentina, Brazil and Mexico.
