NII Holdings announces plans for $811 million tower transaction

Published August 9, 2013 by Veronica Garabelli

Reston-based mobile communications company NII Holdings has agreed to sell approximately 2,790 towers in Brazil and 1,666 towers in Mexico to American Tower Corp. in two transactions totaling $811 million.

Nextel Brazil and Nextel Mexico, two of NII’s brands in Latin America, agreed to lease back the towers from American Tower for a minimum 12-year initial lease term and have the option to extend the lease for additional renewal periods. NII International Telecom S.C.A, a subsidiary of NII based in Luxembourg, has agreed to provide certain credit support with respect to the obligations of Nextel Brazil.

The transaction agreements provide that all payments, including the purchase price and site rental, will be made in local currencies.  As a result, the estimated U.S. dollar denominated proceeds amounts are subject to changes in value of the local currencies relative to the U.S. dollar. 

The transactions are subject to regulatory approvals and the initial closings are expected to be completed in the fourth quarter of 2013.

The Company expects that a majority of the assets sold and leased-back will be accounted for as capital leases. As a result, the transactions are expected to have a positive impact to OIBDA, but are not expected to materially impact 2013 results.