NII Holdings has reached a revised restructuring deal with creditors following its agreement to sell its Mexican operation to AT&T.
The U.S.-based company, which offers mobile services in Argentina, Brazil, and Mexico – until the sale is completed – has agreed to swap its senior notes for a combination of cash from the proceeds of the Nextel Mexico transaction and equity in the reorganised company. In return, creditors will provide $350 million to prop up NII Holdings until the Nextel Mexico deal is done and dusted.
After years of struggling to stem customer losses amid an expensive migration from its legacy iDEN infrastructure, NII Holdings filed for bankruptcy protection in New York in September 2014.
"Reaching this agreement is another significant step forward in our reorganisation process," said Steve Shindler, NII Holdings’ CEO, in a statement on Friday. "We are focused on strengthening our balance sheet and improving our capital structure and liquidity in order to allow us to emerge as a stronger, healthier company that is well positioned for growth and profitability."
Friday’s agreement replaces the one that NII Holdings and its creditors reached in November.
Under NII’s previous restructuring deal, struck last November, the company agreed to swap $4.35 billion of unsecured notes into equity. In return, creditors pledged $500 million of new capital in the form of a $250 million rights offering in the reorganised company and $250 million of exit financing in the form of debt.
However, the situation changed in January when NII Holdings agreed to sell Nextel Mexico to U.S. telco giant AT&T for $1.9 billion.
