PORTLAND, Maine — Maine regulators have approved FairPoint Communications’ sale to the Illinois-based Consolidated Communications, in a deal that requires the new owner to invest $52.2 million in the company’s networks over three years.
Regulators found during deliberations Wednesday that the deal would put the company on a stronger financial footing and that the terms of the deal, with the negotiated settlement, would not harm Maine customers.
The unanimous approval from the three-member commission gives the North Carolina-based FairPoint one in a series of required approvals for Consolidated’s $1.5 billion purchase. The Vermont Public Service Board on Friday was still working out similar investment requirements for approving the deal, according to Vermont Public Radio.
Angelynne Beaudry, a FairPoint spokeswoman, said the Maine approval is “a major step” and the company is “pleased with the continued progress in obtaining regulatory approvals for the proposed merger.”
The terms negotiated by customer advocates and other internet and telephone service providers will allow Consolidated to borrow $935 million in order to refinance $915 million of FairPoint’s debt.
Regulators will allow Consolidated to use FairPoint’s Maine properties as security for that new credit line, which commissioner Bruce Williamson said will reduce the company’s interest payments and put the company on firmer footing.
The deal also calls for $17.4 million of annual investments in 2018, 2019 and 2020, primarily in building out FairPoint’s broadband networks and upgrading network speeds.
The company would spend $1 million of that money each year on improvements to areas where its network has higher than average problems.
Two unions representing FairPoint workers across Maine, New Hampshire and Vermont did not join or oppose the settlement and the deal.
The deal leaves review of Consolidated’s plan to find $55 million in “synergies” to a future meeting with the unions and public advocate. The settlement requires that meeting to happen no later than three months after the deal closes.