RESTON, Va.-NII Holdings Inc., partially owned by Nextel Communications Inc., said several 800 MHz licenses that it won in a Mexican auction have been transferred to the company. The company acquired an additional 15 megahertz of spectrum per basic service area, bringing NII’s average spectrum position to 20 megahertz nationwide, for less than $4 million in upfront cost.
The additional licenses cover approximately 43 million potential subscribers, bringing NII Holdings’ total licensed coverage in Mexico to about 97 million subscribers. The company plans to use the additional licenses to expand its footprint to cover an additional 20 million subscribers, representing nearly a 50-percent increase in its covered subscriber base to about 61 million. Phase one of NII’s 2005 expansion plan in Mexico includes the launch of six new cities, including Juarez, Reynosa, Matamoros, Saltillo, Torreon and Aguascalientes, covering an additional 5.5 million potential subscribers by year-end.
“As previously announced, a number of pending legal disputes were preventing the transfer of the licenses that we won in the 800 MHz auction,” said Steve Shindler, NII’s chairman and chief executive officer. “Because of our high level of success in the 800 MHz auction, and along with other business considerations, we will no longer be participating in the currently suspended 1900 MHz auction.”
Last week, NII announced 2005 financial guidance of $450 million in operating income before depreciation and amortization, a 30-percent improvement over the prior year provided certain assumptions held true. One of the primary assumptions was the receipt of the 800 MHz licenses won in the Mexican spectrum auction in the first half of the year.
