NII Holdings on Friday missed a $118.8 million interest payment on an $800 million bond.
The U.S.-based company, which operates mobile services in Argentina, Brazil, Chile and Mexico under the Nextel brand, now has a 30-day grace period in which to make the payment or face potential non-repayment claims.
NII Holdings said talks are ongoing with bondholders over restructuring its debt obligations.
However, "the company has not entered into any agreements relating to a potential restructuring of its obligations, and there can be no assurance that these efforts will result in any such agreement," said NII Holdings, in a statement.
Issued in 2009 by its subsidiaries NII Capital and NII International Telecom, the bond matures in 2016 and carries a 10% coupon rate – the amount of interest the bondholder receives during the lifetime of the bond.
Amid poor financial and operational performance, NII Holdings warned last week that it is likely to file for bankruptcy protection unless it can renegotiate debt repayments.
In the second quarter, NII Holding's net loss increased significantly on-year to $623.3 million from $396.4 million. Its net debt stood at $4.8 billion.