NII rebounds on asset sale news; RadioShack rises ahead of earnings; Fannie, Freddie mixed

By Stephanie N. Rotondo

Phoenix, Aug. 18 – NII Holdings Inc. continued to be actively traded in the otherwise muted distressed debt space, traders reported Monday.

The company’s debt began to trade – and fall – heavily last week after the company announced weak quarterly results and warned that a bankruptcy was imminent.

Come Monday, however, the bonds were rebounding. One trader attributed the gains to a “dead cat bounce,” but there was news out regarding the Reston, Va.-based provider of Nextel mobile services in Latin America and Mexico.

NII Holdings said Monday that it was selling its Chilean subsidiary to a joint venture that includes Grupo Veintitres, an Argentine media company; Optimum Advisors, a U.S. private-equity firm; and ISM Capital, a London-based investment firm that focuses on emerging markets.

The company did not say how much it would receive for the asset and also noted that it is continuing talks with bondholders regarding a restructuring.

Regardless of what was causing the bonds to rally, they were definitely trading higher on “tons of trading,” according to one trader.

RadioShack Corp. expected to release earnings Monday, though the results were not available by 5 p.m. ET.

Even as the market was predicting another weak quarter, however, a trader said the 6¾% notes due 2019 were moving up.

A trader said there was news out regarding Fannie Mae and Freddie Mac, but that the agencies’ preferreds were “not moving around much.”

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