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January 14, 2011

FairPoint bankruptcy to end this month

By The Mainebiz News Staff

A federal bankruptcy court yesterday gave FairPoint Communications the green light to emerge from Chapter 11 bankruptcy.

Mike Smith, the company's Vermont president, told The Associated Press the North Carolina-based company expects to complete the process by the end of this month, 14 months after the company initially filed for bankruptcy. Last month, Vermont regulators approved FairPoint's reorganization plan after initially rejecting it, the last hurdle before bringing the plan before the U.S. Bankruptcy Court in New York City. Maine and New Hampshire regulators signed off on the plan over the summer.

The reorganization plan includes shedding about $1.7 billion in debt, bringing it to $1 billion, giving secured creditors a 92% ownership stake in the restructured company and giving unsecured creditors 17 cents for every dollar owed. FairPoint bought Verizon's landlines in the three states in 2008 for $2.3 billion.

Go to the article from The AP >>

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