NII Holdings eyeing bankruptcy proceedings after poor quarter

Struggling mobile operator NII Holdings, which operates the Nextel mobile telephony brand in Latin America, will most likely file for chapter 11 bankruptcy proceedings after significantly widening its net loss in the second quarter.

NII posted a net loss of US$629mn compared to a loss of US$385mn a year ago. Revenues fell 23% to US$969mn, while the company saw a 77,000 net subscriber loss, bringing its quarter-end subscriber base to 9.4mn, down 6% year on year. Consolidated Arpu was US$28, down from US$36 a year ago.

An NII release said, "As a result of the company's financial performance in combination with the potential impact of its inability to satisfy certain financial covenants under our existing debt obligations, the company will likely find it necessary to file a voluntary petition for relief under chapter 11 of the bankruptcy code in order to implement a restructuring of its obligations."

CEO Steve Shindler added, "Despite the actions we've taken to improve our operational performance, we have fallen short in our efforts, leaving the company with a liquidity position that is not sufficient to support the business."

"As a result, we will need to make some key decisions in the short term to address our liquidity situation in an effort to secure the best possible path forward for our stakeholders."

NII operates in Mexico, Brazil, Argentina and Chile.