PUC allows scrutiny of Verizon-Carlyle deal
Associated Press
The U.S. Defense Department and two local telecommunications providers were granted requests to intervene in the Carlyle Group's $1.65 billion proposed acquisition the Hawai'i telephone operations of Verizon Communications Inc., state officials said yesterday.
An order issued by the state Public Utilities Commission means the groups will get access to all documents reviewed by the state agency and be able to participate in the discovery process and ask questions of the Carlyle Group, Verizon Hawaii and others involved in the transaction.
One of the local companies being allowed to intervene, Pacific LightNet Inc. of Honolulu, has opposed the sale, which was announced in May.
The Defense Department and Time Warner Telecom of Hawaii Inc., doing business as Oceanic Communications, did not take a position on the sale but expressed reservations about Carlyle Group's plans to revamp Verizon Hawaii's back-office operations.
Pacific LightNet and Time Warner compete with Verizon Hawaii but also depend on its services. Competitors rely on interconnection agreements with operators of former monopoly networks to complete phone calls to each other's customers, among other things.
In its motion to intervene, the Defense Department expressed reservations because telecommunication infrastructure and service are "essential to the nation's safety, security, federal governmental operations and military readiness."
Local 1357 of the International Brotherhood of Electric Workers also filed a motion to intervene on behalf of Verizon Hawaii retirees.
The PUC denied the union's motion but said two retirees, Jeremiah C. Genovia and Charles K. Hekekia Jr., will have the opportunity to participate and address issues related to how the change of ownership might affect retirees' pension, medical and employee stock benefits.
Carlyle's purchase includes the local telephone business, long-distance and Internet services as well as Verizon's print yellow page business. These operations produced $610 million in sales last year. The transaction does not include Verizon Wireless operations.
In addition to the PUC, the acquisition also must be approved by the Federal Communications Commission and the Justice Department.
Yesterday's order by the PUC also establishes a public comment period running through Sept. 30.
