Article Photos

PORTLAND, Maine - FairPoint Communications Inc. had its work cut out when it grew sixfold overnight by buying Verizon Communications' land line and Internet operations in three New England states. But the nation's credit crisis and a bungled technology transfer made the task virtually impossible.

With a battered financial sheet and a tattered reputation, FairPoint filed for Chapter 11 bankruptcy protection on Monday, barely 18 months after becoming the dominant telecommunications company in Maine, New Hampshire and Vermont.

The bankruptcy filing was widely anticipated and fulfilled critics' predictions that FairPoint was taking on more than it could handle when it bought the Verizon properties for $2.3 billion.

But nobody's taking satisfaction in saying, "I told you so."

"What good does it do us? We can say it, but we're left here to do deal with it," said Pete McLaughlin of the International Brotherhood of Electrical Workers, which represents FairPoint employees.

FairPoint, based in Charlotte, N.C., owns and operates phone companies in 18 states with a total of 1.65 million lines. Its largest holdings are in Maine, New Hampshire and Vermont.

The company voluntarily filed for bankruptcy after agreeing on a deal with key lenders that would lower its debt from $2.7 billion to $1 billion and significantly cut its interest expenses, CEO David Hauser said. The plan is subject to approval by the U.S. Bankruptcy Court in the Southern District of New York.

Hauser said the filing will not affect the company's day-to-day operations or its efforts to expand its high-speed Internet network in northern New England.

"From a customer point of view, this is a nonevent," he said.

Monday's filing prompted the New York Stock Exchange to suspend trading in the company's stock. The company was notified last month that its stock could be removed from the exchange because the price had fallen below $1 a share for 30 consecutive trading days.

Regulators and politicians said they would look out for the interests of FairPoint's customers and workers. The regulatory boards in Maine and New Hampshire said they have hired bankruptcy specialists to help during the process. Staff members from the three states' regulatory boards planned to meet with FairPoint's management and staff on Monday.