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March 12, 2009

FairPoint wants more time on debt payment

By The Mainebiz News Staff

FairPoint Communications is asking the Maine Public Utilities Commission if it can postpone a scheduled $11.25 million debt payment as the company tries to manage its cash flow during tough economic times.

The company wants to postpone the payment, scheduled for the end of March, because it expects a cash crunch during the first part of the year. A transition to a new billing system meant customer bills were sent late, which means bills will not be paid as soon as expected, according to the Portland Press Herald. Gene Johnson, chairman and CEO of FairPoint, told the paper that the debt payment waiver is a one-time request and that the $11 million payment would be made in June, followed by the regularly scheduled payments. He expects operations to be stable by summer, the paper said. The PUC has not set a timetable to consider the company's request.

FairPoint agreed to the scheduled debt payments as a condition for the Maine PUC's approval of the Charlotte, N.C.-based company's $2.3 billion acquisition of Verizon's landline business in Maine, New Hampshire and Vermont.

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