RESTON, Va.—NII Holdings Inc., Nextel Communications Inc.’s international operations, said it has reached an agreement in principle with its main creditors Motorola Credit Corp., Nextel and a consortium of bondholders for a restructuring of its outstanding debt and filed for Chapter 11 bankruptcy reorganization in the United States.
The agreement calls for $190 million in new capital, $140 million of which will be in the form of a rights offering of new senior secured notes and warrants to bondholders. Bondholders will backstop at least $75 million, with Nextel backstopping up to $65 million of the rights offering to NII bondholders. Nextel has also agreed to provide $50 million of additional funding in return for a cross-border spectrum sharing arrangement.
The restructuring is expected to reduce NII’s total indebtedness from its current $2.7 billion to less than $500 million.
NII said none of its foreign subsidiaries are part of its bankruptcy filing and will continue to operate during the Chapter 11 process.
