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‘No more legit obstacle to PTI-Verizon deal’
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Posted on Feb 19 2005
House Speaker Benigno R. Fitial extended Thursday his congratulations to Pacific Telecom Inc. for securing the government’s approval for its purchase of Verizon Pacifica.
Fitial cited Pacific Telecom’s “remarkable patience” and its “persistent good faith negotiations” in finally securing the Commonwealth Telecommunications Commission’s approval for the $60-million transaction.
“[Pacific Telecom’s] commitment to serving the CNMI is very evident from their extreme patience and persistence in working with CTC to resolve a wide range of issues and concerns,” said Fitial.
The official also congratulated the commission for working hard over the course of many months to arrive at a negotiated settlement that benefits Verizon, Pacific Telecom, the government, and thousands of commercial and residential consumers.
As a result of the commission’s decision, Fitial said he has every confidence that consumers will soon enjoy a wide variety of additional telecommunications benefits and services at reasonable cost.
Fitial, who supported Pacific Telecom’s purchase bid throughout the commission’s deliberations, believes there is no longer any legitimate obstacle to the consummation of the sale and dismisses concerns over Pacific Telecom’s financing of the purchase, saying it is a normal business practice for companies to use leverage in making acquisitions.
“Using debt to acquire income-generating assets is a very sound business practice, especially when the interest rate is low,” said the Speaker.
Fitial also pointed out that the commission should not be bothered by Pacific Telecom’s debt if the bank extending the credit cleared the transaction, saying that “banks are not in the habit of lending money loosely, particularly when it amounts to millions of dollars.”
The commission also noted that Pacific Telecom would be profitable under three different business scenarios projected by Deloitte & Touche in its audit report. The report was used as a basis in granting the approval of the sale.
