NII Holdings Sells Chilean Subsidiary

NEW YORK (The Deal) -- NII Holdings (NIHD)NIHD, which provides wireless services in Latin America under the Nextel brand, has sold its Chilean subsidiary as it continues restructuring negotiations with bondholders following a $118.8 million missed interest payment.

The Reston, Va.-based telecom company said on Monday, Aug. 18 that Fucata SA, a joint venture comprised of Argentina-based media group Grupo Veintitres, asset manager Optimum Advisors and London-based merchant bank ISM Capital LLP, agreed to acquire NII's equity stake in Nextel Chile SA.

The sale price was not disclosed.

NII skipped interest payments totalling about $118.8 million on its 7.875% notes, 11.375% notes and 10% notes on Aug. 15, but has a 30-day grace period to make up the missed payment.

NII said on Aug. 15 that it is in ongoing discussions with its senior noteholders about options to restructure those securities, "including by exchanging all or a portion of the senior notes for equity interests in, or debt securities of, the reorganized company."

The company had warned in an Aug. 11 regulatory filing that it's talking to noteholders about restructuring options, including a debt-for-equity swap that would exchange all or some of its $4.4 billion in senior notes for equity. Equity holders will most likely be wiped out, the company said.

NII is attempting to reach a restructuring agreement with its creditors out-of-court. However, the company noted on Aug. 11 that, even if it succeeds, a Chapter 11 filing will likely be necessary to enforce the plan.

NII's shares closed at 21 cents on Tuesday with a market cap of $31.31 million. The stock has sunk a long way -- nearly 92% -- since its closing price of $2.58 on Feb. 27, just before the company released a disastrous second quarter earnings report.

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