NII Holdings Inc, the parent of Nextel operators in Latin America, filed for chapter 11 protection yesterday after struggling for years with debt, fierce competition in Brazil and Mexico, and a dispute with a U.S. hedge fund, Reuters reported yesterday. The decision should allow Reston, Va.-based NII Holdings to restructure debt with creditors by turning them into shareholders. NII Holdings operates in several countries in Latin America under the Nextel brand. NII said in court documents that it had received a notice in March from Aurelius Capital Management alleging that it had defaulted on $500 million of unsecured notes. Aurelius said that it had presented a plan to NII that would convert the company's debt into equity and raise fresh capital by selling new stock in the company, while deferring some disputes until after NII emerged from bankruptcy.
