NII Holdings Inc.
), which offers wireless services in Latin America, has
successfully completed the sale of its Mexican towers to
American Tower Corp.
AMER TOWER CORP (AMT): Free Stock Analysis
AMER MOVIL-ADR (AMX): Free Stock Analysis
NII HLDGS-CL B (NIHD): Free Stock Analysis
TELEFONICA S.A. (TEF): Free Stock Analysis
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In Oct his year, NII Holdings struck a deal with American Tower
to sell 2,790 Brazilian towers and 1,666 Mexican towers for $413
million and $398 million, respectively. Moreover, NII Holdings
will lease back these towers for a period of 12 years.
After selling its Mexican towers, NII Holdings is determined to
complete the sale of its Brazilian towers by the end of fiscal
NII Holdings is targeting the highly lucrative Brazilian and
Mexican markets, which are dominated by
America Movil S.A.B. de C.V.
). Thus, to consolidate its position in these markets, NIHD plans
to aggressively rollout its 3G service integrated with the Push
to Talk (PTT) technology by the end of 2013. However, lack of
funds has been a bottleneck for the company.
In order to finance its 3G deployment, NIHD plans to raise nearly
$1 billion in fiscal 2013 either through tower sale or by issuing
senior notes. Few months back, the company also sold its Peruvian
business to Chile's EmpresaNacional de Telecomunicaciones S.A.
(or Entel) for around $411 million.
The company exited the third quarter of 2013 with nearly $5.7
billion of debt and $1.9 billion cash. Moreover, its current
debt-to-capitalization ratio stands at 0.82, which tends to be
quite high. Offloading the assets will provide NIHD with the much
needed liquidity to continue with its third generation network
deployment in Brazil and Mexico.
Currently, NII Holdings carries a Zacks Rank #3 (Hold).