FairPoint shareholders to decide merger with Verizon unit on Aug. 22

By Lisa Kerner

Charlotte, N.C., July 19 - FairPoint Communications, Inc. will hold its annual meeting at 9 a.m. ET on Aug. 22. Shareholders will be asked to vote on the company's merger with Verizon Communications Inc.'s wireline operations in Maine, New Hampshire and Vermont in a transaction valued at some $2.715 billion.

The board of directors of FairPoint has unanimously approved the merger agreement and unanimously recommends its stockholders vote in favor of the deal.

FairPoint said it believes the merger "represents the optimal strategic solution to increase stockholder value," according to a schedule 14A filing with the Securities and Exchange Commission.

The companies announced the merger agreement on Jan. 16.

As previously reported, under the agreement FairPoint will issue about 53.8 million of its common shares to be distributed in a tax-free Reverse Morris Trust transaction to the shareholders of Verizon as well as assume roughly $1.7 billion of debt.

The transaction will give FairPoint's shareholders 40% ownership and Verizon's shareholders 60% ownership of the combined company.

In addition, three existing directors from FairPoint will maintain their positions on the combined company's board of directors. Verizon will nominate six independent directors to the new board.

Verizon Communications, based in New York, delivers broadband and other wireline and wireless communication solutions.

Charlotte, N.C.-based FairPoint is a provider of communications services to rural communities.

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