By Narayan Ammachchi
U.S. telecommunication firm NII Holdings Inc has agreed to sell Nextel del Peru, its Peruvian subsidiary, to Entel for approximately $400 million.
The Reston, Va-based company stated in a press release that it would use the proceeds to expand and bolster operation in Latin America’s main markets – Brazil and Mexico.
Nextel del Peru offers telecom services in Chile, Peru and Argentina, and the carrier reported a US$115.4 million operating loss last year.
NII Holdings said it would soon deploy next generation networks in Mexico and Brazil and seek to sign up more customers for its telecom services. “The proceeds that we generate through this sale allow us to prioritize investments in our largest markets that offer the greatest opportunity for strong, long-term returns,” said Steve Shindler, NII’s chairman and interim chief executive officer.
Nextel Peru is the first to launch HII Holding’s next-generation networks as well as push-to-talk services in Latin America.
The US telecom firm expects the transaction to be closed in the second half of this year. Entel offers mobile, internet, data and IT services, as well as local and long-distance telephony to both consumers clients and enterprises in Chile. Entel’s wholesale and corporate unit, Americatel, has strong presence in Peru.
Analysts say Entel will retain the Nextel brand and will focus on the market where it has already built a strong consumer base.