Pressure grows as Nextel's losses skyrocket

NII Holdings, the parent company of mobile carrier Nextel Brasil, saw its already delicate financial situation complicate further as losses skyrocketed in the second quarter of the year.

The group posted net losses of US$84.8mn, compared to US$9.9mn net loss a year earlier. In the first six months of this year, net loss amounted to US$177.5mn, up from US$46.5mn.

NII Holdings attributed the poor result to restructuring, and impairment charges in the amount of US$54mn.

Net revenues, in turn, fell to US$225mn, down from US$249mn the year-before. For full results, click here.

The company also announced a preliminary agreement to delay payments on its bank loans.

In July, Nextel closed a deal to transfer a 30% stake in Nextel to Norwegian AINMT Holdings AB, in exchange for US$50mn in investments - with an option exercisable by November 15 to reach to US$200mn and a 60% stake.

"The partnership is expected to provide Nextel Brazil with a significant increase in capital to revitalize the business and enable it to pursue a growth strategy that NII could not fund alone," it was reported on the occasion.

Nextel ended June with 3.42mn mobile clients, of which 2.86mn were 3G and 4G (up 5.4% year-over-year).

iDen accesses (radio push-to-talk), shrunk by more than 50% year-over-year.

The loss of clients was another driver of Nextel's negative results, according to the company.

UNLIMITED

In related news, Nextel announced the offer of plans with unlimited voice calls, joining Brazilian carriers Oi, TIM, Claro and Porto Seguro Conecta.

With that, Telefónica's Vivo remains the only one among the most relevant mobile players in the country not to embrace such strategy.

As TIM, Nextel is making unlimited calls available to post-paid and hybrid (control) plans, in a bid to attract clients and stand from competitors.