FairPoint, New Hampshire utilities commission staff reach agreement in Verizon merger

By Lisa Kerner

Charlotte, N.C., Jan. 24 - FairPoint Communications, Inc. reached an agreement with Verizon Communications Inc. and the staff of the New Hampshire Public Utilities Commission regarding FairPoint's proposed acquisition of Verizon's wireline operations in New Hampshire.

The settlement agreement is consistent with material terms of the amended stipulation agreement with the Maine Public Utilities Commission and the settlement agreement with the Vermont Department of Public Service. It also addresses capital expenditures, network and service quality improvement plans, broadband expansion and assurances of financial viability that will benefit New Hampshire.

In the agreement, the parties recommend the New Hampshire Public Utilities Commission approve the settlement agreement, a company news release stated.

"We are pleased at the thoughtful approach by the staff of the New Hampshire Public Utilities Commission and believe this agreement appropriately addresses important public interest issues in the state," FairPoint chairman and chief executive officer Gene Johnson said in the release.

As previously reported, under the terms of their Jan. 16, 2007 merger agreement, FairPoint will acquire Verizon's wireline operations in Vermont, Maine and New Hampshire.

The Federal Communications Commission has approved the assignment of authorizations and licenses in the proposed acquisition.

In the merger, FairPoint will issue about 53.8 million of its common shares to be distributed in a tax-free Reverse Morris Trust transaction to the shareholders of Verizon as well as assume roughly $1.7 billion of debt. The transaction will give FairPoint's shareholders 40% ownership and Verizon's shareholders 60% ownership of the combined company.

Verizon, based in New York, delivers broadband and other wireline and wireless communication solutions.

Charlotte, N.C.-based FairPoint is a provider of communications services to rural communities.

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