Telecom Italia's (TI) board of directors approved a non-binding bid for Nextel Telecomunicacoes, Bloomberg reports, citing people familiar with the matter. The offer for Nextel could shore up the Telecom Italia's position in Brazil, where competition has kept prices low, the report notes. Nextel's largest investor is NII Holdings (NIHD), the report notes. In the same meeting, Telecom Italia also abandoned a debt target and decided to write down the value of its assets by roughly EUR2B, the report says.
Shares of NII Holdings (NIHD) are up by over 10% in early trading. Yesterday, CTFN, which focuses on M&A reporting, published a report stating that it was told that TIM Brasil (TSU) was in early stage talks to acquire Nextel. Near 11 am ET, NII Holdings shares are up 70c, or 10.7%, to $7.20. Reference Link
A translation of an article from Tele.sintese said that Anatel, the National Telecommunications Agency of Brazil, intends to approve changes in spectrum limit rules for carriers and could allow the big operators to buy Nextel and Sercomtel. Reference Link
Nextel Brasil could soon be bought by TIM, says Cowen. Cowen credit research analyst Lance Vitanza noted news reports suggesting TIM Participacoes (TSU) may be close to bidding for Nextel Brasil, the Brazilian wireless communications company owned by NII Holdings (NIHD). The analyst said while unconfirmed, in his opinion it makes sense and he remains constructive on NII shares. He believes a bid is worth at least $2.5B, which would translate into $14 a share or more for NII Holdings shares.