October 4, 2010 / 1:32 PM / in 7 years

UPDATE 3-Televisa says discussions ongoing over Nextel deal

* Mexico grants Nextel, Televisa phone license

* Plan to deploy new 3G network in Mexico

* Companies talking over agreement details (Adds Nextel comments, updates stock quotes)

By Cyntia Barrera Diaz

MEXICO CITY, Oct 4 (Reuters) - Broadcaster Televisa said it was in discussions with NII Holdings on a wireless venture on Monday, days after the Mexican government gave the two firms a license to use spectrum for a new network.

“Discussions are ongoing between Grupo Televisa and NII Holdings as to whether certain closing conditions have been or can be satisfied,” the company said in a brief statement.

In July, Televisa (TV.N) (TLVACPO.MX) and NII Holdings’ Nextel Mexico won spectrum in a government auction that they plan to use to develop a 3G data services network to better compete with billionaire Carlos Slim’s America Movil (AMX.N) (AMXL.MX) and Spain’s Telefonica (TEF.MC).

It was not until last week that Televisa and Nextel were granted the license after nearly 70 legal challenges from rival companies owned by communications tycoon Ricardo Salinas.

“There are many conditions under review,” Nextel Mexico Vice President Gustavo Cantu told Reuters on Monday. “I can’t tell you if there will be additional conditions (to the previously announced deal) or not.”

Now that the license has been granted, NII Holdings (NIHD.O) said in a separate statement that the parties had agreed to delay the closing date for up to five business days to allow time for further discussions.

    “I think that this is lawyers at work,” said analyst Kevin Roe with Roe Equity Research LLC. “This has been such a complex process that they just have to make sure everything is in order.”

    The agreement with Nextel allows Televisa to add mobile phone services to its television, Internet and fixed-phone services, while Nextel will get money to upgrade its network and sell more sophisticated products to a broader client base.

    Televisa earlier had committed to buying 30 percent of Nextel Mexico, a unit of NII Holdings, for $1.44 billion once the Mexican government granted the license needed to operate their new spectrum slice.

    “Once we finish reviewing the closing conditions we will be able to say how we are moving ahead,” Cantu said.

    Televisa, the world’s biggest producer of Spanish-language content, declined to elaborate.

    Attorney Salvador Rocha, representing businessman Salinas and his companies, said on Monday they would pursue suing several officials over what they say were uneven conditions for participants in the frequency auction.

    Televisa shares closed down 0.13 percent at 47.72 pesos in Mexico while its New York-traded stock slipped 0.26 percent to $18.91. NII Holdings firmed 0.43 percent to $42.49. (Reporting by Cyntia Barrera Diaz. Additional reporting by Tomas Sarmiento. Editing by Missy Ryan and Robert MacMillan)

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