Grupo Veintitres, a media group, is reportedly on the verge of striking a deal with NII Holdings that would see it acquire Nextel Argentina and Nextel Chile for nearly $250 million.
NII Holdings provides mobile services in Latin America under the Nextel brand.
According to local press reports, two Argentinian businessmen Matías Garfunkel and Sergio Szpolski – who own the media group and are said to have close ties with Argentina’s government – are expected to make an offer this week in partnership with (unnamed) US investors.
Grupo Veintitres is apparently keen to take part in Argentina’s upcoming 4G spectrum auction if they acquire NII Holdings’ local subsidiary.
The frequencies up for grabs in the auction are in the 700MHz and 1.7-2.1GHz spectrum bands. Winning bidders have five years to complete 4G network rollout.
There is some speculation in the Argentinian press that Garfunkel and Szpolski, who are newcomers to the telecoms sector, would roll out the 4G network and then try and sell the company within three years for double the amount they invested.
NII Holdings has been under financial pressure as it struggles to compete against bigger competitors in markets where it operates (as well as Argentina and Chile, Nextel-branded subsidiaries are present in Brazil and Mexico).
To strengthen its financial position, NII Holdings hived off its Peruvian subsidiary to rival Entel for $410.6 million as part of its plan to focus on Brazil and Mexico. It also announced plans late last year to cut a quarter of its workforce in a bid to become more operationally streamlined.
Earlier this year, NII Holdings signed a deal with Telefonica that will give its customers in Brazil and Mexico access to nationwide 3G data and voice. There was some analyst speculation at the time that NII Holdings was vying for an eventual sale to Telefonica.
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