NII Is ‘Very Close’ to Selling Brazil, Mexico Towers, CEO Says
NII Holdings Inc. (NIHD), the provider of Nextel mobile-phone service in Latin America, plans to sell about 4,500 wireless towers in Brazil and Mexico by midyear to focus investment on third-generation, or 3G, technology, Chief Executive Officer Steven Shindler said.
The Reston, Virginia-based company will use the proceeds of the sale of the towers and its Peru unit to expand networks and marketing in Brazil and Mexico, where it’s concentrating the bulk of $1 billion in capital spending this year, Shindler said. The company is “on track” to introduce 3G and smartphones in Mexico in the third quarter and in Brazil by year-end, he said.
“Mexico and Brazil are the most significant growth opportunities for us,” Shindler said yesterday in an interview on the sidelines of the World Economic Forum in Lima. “There’s a big push for data, but there’s obviously still a very significant need for voice.”
NII sold its Peruvian unit to Chile’s Empresa Nacional de Telecomunicaciones SA for $400 million earlier this month as the company struggles in Latin America against larger competitors such as America Movil SAB (AMXL) and Telefonica SA. (TEF) NII, which posted a $593 million loss in the fourth quarter, said new 3G networks should help it gain more subscribers. The company plans to lease back the Brazil and Mexico towers after they are sold.
Mexican legislation aimed at boosting competition in the telecommunications industry, by allowing foreigners to hold majority stakes in local units, is “a good trend,” Shindler said. NII, which has 4 million customers in Mexico, will double its target market to 50 million with the introduction of smart phones, he said.
“The changes that are being discussed in the telecom act create a better environment for us,” he said. “We think we can compete and get back to growing in a profitable manner.”
The shares fell 3.4 percent to $8.16 yesterday at the close in New York. NII, which plunged 67 percent last year, have jumped 80 percent since announcing the sale of its Peruvian unit on April 4.
The company is scheduled to report first-quarter earnings on May 2.
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