NII Holdings Inc.
), which offers wireless services through its Nextel brand in
Latin America, has completed the sale of its Peruvian business to
Chile's Empresa Nacional de Telecomunicaciones S.A. (or Entel),
for around $411 million.
NIHD will use the sale proceeds to focus on two of its largest
markets, Mexico and Brazil. On the other hand, the acquisition
will allow Entel to expand its business in foreign countries.
Nextel Peru, part of NII Holdings for the last 15 years, provides
wireless services across major business centers in Peru using the
W-CDMA (Wideband-Code Division Multiple Access) technology that
offers high-speed Internet access. At the end of the first
quarter of 2013, Nextel Peru offered services to 15% of the total
subscribers of NIHD and contributed only 5.8% to the company's
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.
The company exited the second quarter of 2013 with nearly $5.6
billion of debt and $1.8 billion cash. Offloading the assets will
provide NIHD with the much-needed liquidity to continue with its
third generation network deployment in Brazil and Mexico.
A few days back, NII Holdings also struck a deal with
American Tower Corp.
). Per the deal, NIHD will sell 2,790 Brazilian towers and 1,666
Mexican towers for $413 million and $398 million, respectively.
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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Currently, NII Holdings carries a Zacks Rank #3 (Hold).