Corporate Finance

Nextel to be Sold for $ 200 Million Dollars

Nextel has three million clients in Brazil.

Nextel has three million clients in Brazil.

In June, it was announced that Nextel Brazil will be sold for $200 million dollars to the Scandinavian group AINMT, which operates in Norway, Sweden and Denmark, with the Ice brand.


The move comes as a necessity to Nextel, as most of the resources will be used to renegotiate its debts that total $756 million. The transaction will occur in two installments. The first will infuse $50 million in Nextel Brazil, through NII Holdings, a holding company headquartered in Luxemburg that controls the Brazilian telecommunications company. The remaining $150 million will be used directly to renegotiate the debts.


After the payments, NII Holdings will have 40% of control over the company, with the other 60% going to AINMT. The Scandinavian group has until November 15th to make the payment. After delivering the money, AINMT will have three positions in the administrative board of Nextel, whereas NII Holdings will have two.


The law firms Mattos Filho, Veiga Filho, Marrey Jr e Queiroga Advogados and the New York office of Jones Day worked on the deal, helping NII Holdings. The firm Mundie e Advogados and America’s Weil, Gotshal & Manges advised AINMNT.


About AINMT:

Established in 2008, the company is controlled by Access Industries, a privately-held industrial group with long-term holdings worldwide. Founded in 1986 by Len Blavatnik, an American and British entrepreneur and philanthropist. Access is an international industrial concern with global strategic investments.  AINMT is pushing to enter emerging markets and, in 2015, entered Thailand and the Philippines to provide 4G coverage.


Debts and negotiation:

At the end of 2016, Nextel had debts reaching $540 million dollars that expire in 2017. The commitments are centered on Bank of Brazil, Caixa Economica Federal and China Development Bank.


According to Roberto Rittes, CEO of Nextel Brazil, the negotiations are at an advanced stage and have been friendly. He  believes the deal will be finalized within 60 days. The biggest objective of Nextel is obtaining a grace period of four years to repay its debts in full.


The future of Nextel:

With the normalization of its financial situation, Mr. Rittes claims that the company will invest in its strategic plan and will invest to expand its operations providing 4G internet.


In the last quarter of 2016, Nextel made a net profit of $1.8 million.




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