NII Holdings takes a majority stake in Nextel Brasil

Company has 3 mi subscribers, but earnings before interest. Gram Slattery and Tatiana Bautzer, Reuters

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June 28, 2018, 4:27 pm – Published June 28, 2018, NII Holdings contracted Rotschild to sell control of the cellular operator ] Nextel to

Rotschild was recently hired to organize the sale process of NII's 70% stake in Nextel Brazil and has not yet set a date for the delivery of bids, according to a source

Potential stakeholders include Telefonica Brasil, the country's largest mobile operator, and Access Industries, which already holds a 30% stake in Nextel Brazil, according to sources.

NII Holdings, Access Industries and Rothschild did not respond to requests for comment.

If Access does not take control of Nextel Brasil, the company will be able to sell its 30% stake to the buyer of the operator if it wishes.

Telefónica Brazil did not come forward. One year ago, NII entered into an agreement to sell a majority stake in the Brazilian operations to the Norwegian group Ice Group Scandinavia Holdings. The Ice Group has injected $ 50 million into Nextel Brazil and holds a 30% stake in the carrier and an option to add an additional $ 150 million to increase its share to 60%.

Meanwhile, Ice Group lost interest after the first phase of the deal.

Nextel Brazil has 3 million subscribers, but the profit before interest, taxes, depreciation and amortization is close to zero, said the first source. ] NII is less urgent now to sell Nextel Brazil now than it was a year ago, according to the source, as it has completed a $ 2.3 billion reais restructuring in debts to Banco do Brasil, Caixa Econômica Federal and China Development Bank, reduce its liquidity needs in the short term.

Nextel Brazil is the last Latin American subsidiary of NII after the company's departure to Peru, Chile and Mexico, where its unit was sold in the United States. Nextel Brasil could be of interest to other operators in the country because of its frequency bands, which could be used to improve services and reduce investments in states like São Paulo and São Paulo. Rio de Janeiro, sources said.

However, an obstacle to such consolidation is the legal spectrum limit, which the largest operators are already approaching in important regions. The regulatory agency Anatel has considered releasing such limits, which could speed up the case.