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| AT&T is buying bankrupt Nextel Mexico's wireless business for $1.875 billion in a move to create a larger Mexican wireless player that will have a better chance of competing with Carlos Slim's America Movil. | |
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AT&T continued its southward expansion on Monday, agreeing to buy Nextel Mexico for nearly $1.9 billion as part of its campaign to expand its Latin American presence.
The deal is the second struck in Mexico by the telecommunications giant since November, when the company bought the big wireless service provider Iusacell for $2.5 billion.
AT&T has made it clear that international expansion has become one of its top priorities. One of the important parts of its pending $49 billion acquisition of DirecTV is acquiring the satellite television provider’s expanding presence in Latin America, already at 18 million customers and growing.
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With its acquisition of Nextel Mexico — which is being sold by NII Holdings, the bankrupt former Nextel International — AT&T will gain about three million new subscribers, as well as important holdings in wireless network spectrum. Over all, the Mexican cellphone service provider’s network covers about 76 million.
Combining Iusacell and Nextel Mexico will help AT&T create a network spanning the United States and Mexico that it says will cover 400 million consumers and businesses.
AT&T’s offer for Nextel Mexico is essentially a "stalking horse" bid and subject to an auction in the Federal Bankruptcy Court for the Southern District of New York, which is overseeing NII Holdings’ Chapter 11 case. The deal will also require approval by the Mexican telecom regulator known as I.F.T.
Still, AT&T expects the transaction to close by the middle of the year.
Original New York Times Story
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