Latest Comments

    i support ericsson as rcom can dupe anyone , they had... Sunday, 14 October 2018
  • Bud Biswas More
    Our company, Polaris Networks, has helped other smaller... Friday, 12 October 2018
  • Developing Telecoms More
    That is correct - it is the coastline of Equatorial Guinea,... Friday, 12 October 2018
  • Xavier Muñoz More
    This photo is not from São Tomé e Príncipe Thursday, 04 October 2018
  • More
    My name is Adewale. I am a Healthcare Manager in... Friday, 21 September 2018

NII files for bankruptcy following poor Mexican performance

Following a significant drop in customers for its Nextel Mexico unit, NII Holdings has filed for bankruptcy.

The company operates in three Latin American markets as Nextel – Mexico, Brazil and Argentina.

NII treasurer Daniel Freiman stated in court papers: “As NII was racing to complete the buildout of its 3G network, it was experiencing increasing turnover of its customer base as customers were offered more attractive services by its competitors on their 3G networks.”

This suggests that the firm’s hand was forced; in an attempt to prevent subscriber losses it dropped its tariffs, which then sent ARPU spiralling while at the same time pushing up bad debt. The firm also received a notice earlier this year from hedge fund Aurelius Capital Management claiming that it had defaulted on $500 million of unsecured notes.

The hedge fund has contested a restructuring of the notes in 2009, claiming that it amounted to a fraudulent transfer. However, Aurelius has temporarily shelved this dispute in an attempt to help NII convert its debt to equity and raise capital via a share sale. This proposal has however been objected to by other bondholders.

NII is aiming to hold talks with its creditors that will help it out of bankruptcy.


Comments powered by CComment