By Saabira Chaudhuri
NII Holdings Inc. (NIHD) has agreed to sell towers in Brazil and
Mexico to American Tower REIT (AMT) for $811 million, a move that
gives the Latin America wireless-service provider funds to make
continued investments in the two countries.
Shares popped 20% to $7.97 in recent premarket trading. Through
Thursday's close, the stock has dropped 6.5% so far this year.
Under the deal's terms NII--which operates under the Nextel
brand in Latin America--has agreed to sell about 2,790 towers in
Brazil and 1,666 towers in Mexico in two separate transactions for
total estimated proceeds based on current foreign currency exchange
rates of $413 million and $398 million, respectively.
Both Nextel Brazil and Nextel Mexico agreed to lease back the
towers from American Tower for a minimum 12-year initial lease term
and have the option to extend the lease for additional renewal
periods. The transactions are expected to be completed in the
fourth quarter.
NII has previously said it plans this year to continue to invest
in the deployment of its 3G networks, with a particular focus on
building those networks and improving results in its core markets
of Mexico and Brazil.
"The sale of our towers in Brazil and Mexico provides us with
funding at an attractive cost of capital and valuation of our tower
assets," Chief Financial Officer Juan Figuereo, said.
In April, NII agreed to sell its Peruvian operations to Empresa
Nacional de Telecomunicaciones SA (ENTEL.SN) for about $400
million, a deal that narrowed its focus to Mexico and Brazil.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
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