MONTPELIER, Vt. (AP) - Vermont regulators scolded officials with FairPoint Communications Inc. Sunday for their slowness in sharing information about their increased cost of borrowing, but gave the firm the go-head to complete its purchase of Verizon Communications Inc.'s landline phone and Internet service in northern New England.
With the sale set to close Monday, both Vermont's Public Service Board and New Hampshire's Public Utilities Commission met in emergency session to see whether they would withdraw their approvals of the $2.3 billion of the purchase of the region's main phone network. Maine regulators gave the deal a final approval on Friday.
By late Sunday afternoon, there was no word on how New Hampshire's Public Utilities Commission would rule.
Prompting the highly unusual if not unprecedented last-minute weekend hearings was news Friday that FairPoint had filed documents with the Securities and Exchange Commission indicating that the interest rate it would have to pay on more than $500 million in bonds to support the deal had jumped from the 8.5 percent the company had predicted to regulators in January to 13.5 percent when the bonds were sold.
'That obviously shoots some holes in the canoe,' Vermont board member John Burke told FairPoint officials during Sunday's hearing.
But in the end, the board determined that shouldn't stop the deal.
Walter Leach, FairPoint's executive vice president for corporate development, repeatedly told the board he did not believe the higher interest rates would have a big impact on his company's ability to operate the region's phone network.
'I do not believe that the change in interest expense is a material change to the financials,' Leach said. 'We certainly are disappointed in it but it is not a material change.'
Board members agreed that despite long-standing concern about relatively tiny FairPoint's ability to absorb a three-state phone network six times its size, the interest rate change would not affect the company's ability to perform as the region's dominant traditional, wired telephone carrier.
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