FairPoint Communications this week received state approval for its $1.5 billion sale to the Illinois-based Consolidated Communications, with an expected closing date of July 3.
The merger will more than double Consolidated’s fiber-optic cable network and make it the ninth-largest operator in the country.
The deal also means the new owners will invest $52.2 million to upgrade FairPoint’s Maine networks and facilities, which was a condition negotiated between the company and the Office of the Public Advocate.
[What FairPoint’s sale means to Maine customers]
That agreement and other terms helped clear the deal for approval by the Maine Public Utilities Commission last month. The deal also allows Consolidated to use FairPoint’s Maine property to borrow $935 million, in order to refinance its debt at more favorable interest rates.
Regulators said that will reduce the company’s interest payments and improve its financial footing.
The full impact of the merger in Maine is still unclear, as the company has not detailed whether its plan to save $55 million annually from “synergies” will involve cuts in Maine.
The negotiated agreement between the public advocate and the company calls for them to meet later about those plans, no later than three months after the deal closes.
FairPoint said in a statement Wednesday that it expects the deal to close on Monday after securing federal regulatory approvals earlier this year and approval processes in 17 states.
“We are committed to ensuring this merger is seamless for customers and look forward to bringing our expanded product and services portfolio to FairPoint customers in the future,” Consolidated’s President and CEO Bob Udell said in a prepared statement.
Shares of Consolidated (NASDAQ: CNSL) rose Wednesday by about 3.3 percent and was trading down slightly on Thursday morning.