AT&T adds to Mexico shopping spree with Nextel Mexico buy
The $1.875 billion deal follows its acquisition of Iusacell and bid to expand its presence in Mexico.
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AT&T isn't wasting time establishing a foothold in Mexico.
The second largest wireless carrier in the US by subscribers said Monday that it had entered into a deal to acquire the wireless business of NII Holdings, which operates as Nextel Mexico, for $1.875 billion, excluding outstanding debt. NII Holdings, which runs Nextel operations throughout Latin America, filed for bankruptcy in September amid heavy debt and competitive pressure in Brazil and Mexico.
The acquisition will bolster AT&T's position in Mexico, which began with its $2.5 billion purchase of Iusacell. The deals are part of broader plans to tap into new areas of growth, which include burgeoning geographies such as Mexico. AT&T's presence in Mexico and the US gives it unprecedented coverage for a North American carrier, with the potential to cover more 400 million consumers and businesses throughout those two countries.
Nextel Mexico gives AT&T 3 million subscribers and a network that covers 76 million people. The Iusacell assets, which officially became part of AT&T earlier this month, includes 9.2 million subscribers and covers 70 percent of Mexico's population of 120 million people.
AT&T expects the deal to close by the middle of the year, subject to bankruptcy auction and approvals by the US Bankruptcy Court for the Southern District of New York and Mexico's telecom regulator.
The acquisitions mean that AT&T will have to wrestle with different wireless technologies. While Iusacell runs a network based on HSPA+, or the same kind of 3G technology that its parent utilizes, Nextel Mexico uses IDEN, or the same kind of technology employed by the now defunct Nextel business in the US.