AZ, MN, WA, FCC Approved CenturyLink/Qwest Merger; OR Still Needs to Approve [telecom]

Since my previous Wednesday 05-January-2011 posting to Telecom Digest on this issue, three of the last four states needed to approve of the pending CenturyLink/Qwest merger (actually the CenturyLink takeover of Qwest) have since approved, all during this current month of March

2011. And the FCC has approved of the merger/takeover today (Friday).

On Tuesday 01-March-2011, the Arizona Corporation Commission approved, the five-member board voted unanimously.

On Thursday 03-March-2011, the Minnesota Public Utilities Commission approved, the five-member board voted 3-2 for approval.

On Monday 14-March-2011, the Washington (State) Utilities and Transportation Commission approved, the three-member board voted unanimously.

And today, Friday 18-March-2011, the FCC has also approved.

HOWEVER, to date, the only state which still needs to approve and hasn't yet approved so far is the Oregon Public Utilities Commission. Hopefully, there will be an announcement from them early next week. It is a bit unusual that the FCC gave its approval before all of the states which need to approve have done so... but I do wonder if the FCC might have advanced information that the OR-PUC is going to announce its approval early next week?

Both CenturyLink and Qwest hope to have the merger complete/official as of Friday 01-April-2011.

This merger was originally announced almost a year ago, in the second half of April 2010.

In addition to all of the other states (other than Oregon so far) and the FCC approvals, other federal agencies approved of the merger or takeover last year (SEC, DOJ/FTC/IRS Hart-Scott-Rodino Act, etc), and the shareholders of both Qwest and CenturyLink have also approved.

My understanding is that the legacy Qwest/US-West/Mountain Bell, Northwestern Bell, Pacific Northwest Bell areas will continue to be treated as "BOCs" by state and federal regulators, while the legacy CenturyLink (both CenturyTel and Embarq/Sprint/United-and-Centel) exchanges will be treated by regulatory as "independent". Note that CenturyLink does have some territory in Minnesota, Colorado, Oregon, and Washington State that _USED_ to be US-West prior to the mid/late

1990s. During the 1990s, US-West (and Qwest in 2000/01 after they acquired US-West) sold off over 500 exchanges in rural areas and small towns to independent telcos. All 14-states of US-West had exchange areas sold off to independents. PTI, Pacific Telecom Inc, purchased most of the sold-off US-West/Northwestern Bell exchanges in Minnesota, most of the sold-off US-West/Mountain Bell exchanges in Colorado, and most of the sold-off US-West/Pacific Northwest Bell exchanges in Oregon and Washington state, in the mid-1990s-era. In 1997/98, CenturyTel purchased ALL of PTI's operations (except for Alaska) and consolidated them into CenturyTel's operations. But I don't seem to think that these US-West exchanges that were sold off to PTI in the mid-1990s which have been subsequently acquired by CenturyTel are still treated by regulatory as "legacy BOCs".

Similarly, the legacy NET&T areas in Maine, New Hampshire, Vermont that were sold off by VeriZon to FairPoint in 2007/08 are also still considered "BOCs" by state and federal regulators, while the legacy Contel areas in ME/NH/VT that GTE sold off in 1995 (not long after GTE acquired Contel in 1990/91), sold off to legacy independent telcos in those upper New England states (mostly acquired by Northland Tel) and which formed the beginnings of FairPoint in circa 2000 are treated as "independent" areas by state/federal regulators. And the legacy BOC C&P-West Virginia exchanges (including Crows-Hematite VA) which were sold by VeriZon to Frontier in 2009/10 are still considered "BOC" areas by the regulators, while the legacy GTE and Contel areas in WV that GTE sold off in the early 1990s (and GTE sold off both recently acquired Contel AND long-time GTE in WV) to Citizens (now Frontier), as well as the one-time Alltel areas in WV that Citizens (now Frontier) acquired in the mid-1990s, are all treated as "independent" areas by regulatory.

CenturyTel has also acquired other one-time BOC exchanges here and there. About 20 Wisconsin Bell exchanges were sold by Ameritech in

1998 to CenturyTel, and the once-BellSouth/Southern Bell towns of Milton and Gatewood in North Carolina have since become part of CenturyTel after BellSouth sold them off to Madison River Tel/Mebtel in 2005. I seem to think that all of these areas are now treated by regulatory as "independent" telco exchanges.

Anyhow, it's now the OR-PUC which still needs to approve of the pending merger/takeover, which both CenturyLink and Qwest hope to have finalized by Friday 01-April-2011.

Mark J. Cuccia markjcuccia at yahoo dot com

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Mark J. Cuccia
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