A few days ago, the Wall Street Journal’s Dennis Berman commented in his column entitled “The Two Sides of Verizon’s Deal Making” on whether Verizon might have some responsibility for the bankruptcies of Idearc, Hawaiian Telecom and FairPoint Communications. As you may recall, I posted an op-ed piece on the subject, Idearc’s Bankruptcy – Who’s Really Responsible? at Search Engine Land not long back, and now Berman’s take on the issue appears to hold a lot of sympathy for my position that Verizon caused the yellow pages company to fail shortly after it was spun off by requiring it to do so with an unreasonably high debt load.
Berman states that while the market in 2006 may’ve allowed Verizon to take billions in the deal divesting itself of its directories corporation, Idearc, he further states:
“It took too much.”
Will there be any consequences for Verizon’s throwing off these companies with unserviceably high debt loads? Burman reports:
“These things matter greatly to how state and federal regulators perceive the company. Maine, New Hampshire, Vermont and Hawaii each are in an uproar over the FairPoint divestiture, with much of the ire directed at Verizon.”
In a brief video piece, David Berman debates the issue with Evan Newmark, who takes the opposite viewpoint that Verizon should not be held responsible for the performance of its divested companies. (more…)
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Filed under: General, Market Data, Worst Practices, Yellow Pages bankruptcies, bankruptcy, divestments, FairPoint Communications, FairPoint Communications Bankruptcy, Hawaiian Telecom, Hawaiian Telecom Bankruptcy, idearc, idearc bankruptcy, M&A, mergers and acquisitions, spinoffs, Verizon