Sale of FairPoint Comm: Maine

Over the course of the last few months, a number of state regulatory agencies have considered the proposed acquisition of a local exchange carrier (LEC) group, FairPoint Communications, by a telecommunications conglomerate, Consolidated Communications Holdings. Soon after the FCC took action to authorize the merger to proceed, other states began to follow suit. Maine relied on proposed settlements in ruling that the merger should be approved.

Northern New England Telephone Operations LLC d/b/a FairPoint Communications-NNE is the dominant LEC in Maine, leading the state's Office of the Public Advocate to enter into settlement discussions soon after the merger proposal was filed. The ensuing stipulation contained several provisions that the Maine Public Utilities Commission deemed key to its approval of the tendered agreement. 

For one, in that FairPoint-NNE is presently under contract with the state's Emergency Services Bureau to administer Maine's 9-1-1 calling system, the commission said it was pleased that the merger settlement includes a clause preventing Consolidated from eliminating or removing critical personnel from that service for the duration of the contract, except for unlawful acts or unsatisfactory performance. 

The commission stated that the parties also stipulated that all existing interconnection agreements with competitive LECs will be maintained. However, the commission noted with favor that should technological developments render such agreements outdated or inapropos, the agreement provides that they may be renegotiated and updated as needed. The commission stated that it was hopeful that the acquisition of Fair-Point by Consolidated will bring sorely needed broadband access to more areas of the state. The commission commented that citizens long have clamored for additional broadband service and that FairPoint had been unable to deliver on many of its pledges for such, which had been made during the process by which FairPoint had acquired the landline assets of Verizon after that carrier decided to exit from wireline services. 

The commission said it was especially pleased to see minimum annual investment requirements included in the settlement. It reported that the stipulation calls for Consolidated to assure at least $17.4 million in additional capital funding for Maine operations every year from 2018 to 2020. Re Northern New England Telephone Operations LLC d/b/a FairPoint Communications-NNE, Docket No. 2016-00307, June 5, 2017 (Me.P.U.C.).