South American mobile service operator NII Holdings (Nasdaq: NIHD ) has confirmed rumors that it was selling its stake in Nextel Peru by announcing it is selling the unit to Empresa Nacional de Telecomunicaciones S.A. for approximately $400 million.
NII, which operates Sprint's (NYSE: S ) Nextel brand throughout Latin America, previously announced its decision to narrow its focus on its two largest markets, Brazil and Mexico, where it will deploy its next-generation networks. That has opened up the prospects for it selling its operations in Peru, Chile, and Argentina. Shares of the wireless operator shot up as much as 25% the other day as word of a possible deal leaked.
Steve Shindler, NII's chairman and interim CEO, said, "The sale of Nextel Peru is an important step in the evolution of our business and aligns with our strategic goal of increasing value for stockholders through focused investments on our new next generation network deployments. The proceeds that we generate through this sale allow us to prioritize investments in our largest markets that offer the greatest opportunity for strong, long-term returns."
Brazil accounted for 48% of NII's revenues in 2012 and Mexico represented another 35%. At $343 million Peru amounted to less than 6% of the $6.1 million in total sales the mobile service operator generated.
The sales is expected to close in the second half of 2013.