Utility regulators to consider $1.5B FairPoint sale
Consolidated Communications, based in Illinois, announced in December it was buying FairPoint, assuming its debt and offering dividends to stockholders.
Regulators in Maine, New Hampshire, and Vermont — which account for 85 percent of Fairpoint's customer base — and eight other states along with federal regulators will have to sign off on the deal.
The Maine Public Utilities Commission staff will have an opportunity to question officials during a technical conference Tuesday, and New Hampshire will hold similar meetings next month. Vermont, meanwhile, is holding the second of three public hearings.
So far, no formal opposition has surfaced, and the two companies don't see any obstacles to winning regulatory and shareholder approval by the end of June.
Maine Public Advocate Tim Schneider said he wants to make sure telephone service improves, or at least doesn't get any worse, when the deal closes. Maine utility regulators are currently considering a $500,000 fine against North Carolina-based FairPoint for failing to meet minimum service standards.
"It's still early. We're in the process of discovery. There are no obvious red flags at this point," Schneider said. "I'm hesitant to say much more than that."
FairPoint's acquisition of Verizon's landline assets in northern New England was fraught with problems, including financial difficulties that ultimately led to a bankruptcy filing.
Workers also led a four-month strike against FairPoint.
"We just want to make sure they're capable. And if they are, then it'll be welcome," Peter McLaughlin, business manager of Local 2327 of the International Brotherhood of Electrical Workers, said of the deal.
Barry Sine, a telecommunications analyst at Drexel Hamilton, said Consolidated will want to turn the page and look to the future and take advantage of a robust fiber network operated by FairPoint.
"They've got to get this right in the largest and most complex integration that they've faced. It's their biggest challenge ever," Sine said.
Testifying Tuesday before the Maine utilities commission will be Consolidated chief financial officer Steve Childers and vice president for regulatory affairs Michael Schultz, along with Mike Reed, FairPoint's state president in Maine, regulators say.
The New Hampshire Public Utilities Commission will begin formal hearings April 27, followed by the Maine commission on May 4, and the Vermont Department of Public Service on May 8.
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