12. Assignment of Proceeding
Michael R. Peevey is the assigned Commissioner and Timothy J. Sullivan is the assigned ALJ in this proceeding.
1. CCHI is a Delaware corporation.
2. CCI is an Illinois corporation and a wholly owned direct subsidiary of CCHI.
3. Merger Sub II is a California corporation and wholly owned subsidiary of CCI created for purposes of the acquisition of the SureWest companies.
4. The SureWest Companies are California corporations.
5. The SureWest Companies who are applying for the change of control include SureWest Communications, SureWest Telephone, SureWest Long Distance and SureWest TeleVideo.
6. SureWest Communications is a holding company that owns SureWest Telephone, SureWest Long Distance, and SureWest TeleVideo.
7. SureWest Telephone, SureWest Long Distance and SureWest TeleVideo each have a California CPCN.
8. SureWest Telephone is a corporation organized under the laws of California (U1015C). SureWest Telephone is an incumbent local exchange carrier regulated by the Commission which provides local exchange service in Sacramento and Placer Counties, California.
9. SureWest Long Distance is a corporation organized under the laws of California (U5817C). SureWest Long Distance is a non-dominant interexchange carrier regulated by the Commission which provides resold long distance services throughout California.
10. SureWest TeleVideo is a corporation organized under the laws of California (U6324C). SureWest TeleVideo is a limited facilities-based and resale provider of interexchange and competitive local exchange carrier regulated by the Commission. It provides competitive local telephone service and cable television service.
11. As a result of the transaction, CCHI will become the ultimate parent of the SureWest Companies.
12. SureWest Telephone, SureWest Long Distance and SureWest TeleVideo will become wholly-owned subsidiaries of Merger Sub II.
13. SureWest Telephone, SureWest Long Distance and SureWest TeleVideo will continue as subsidiaries holding CPCNs and providing services to their customers.
14. The change in ultimate control will not involve a transfer of customers of the subsidiaries of the SureWest Companies.
15. As part of the transaction, SureWest Telephone will encumber its assets to secure the financing arrangements of CCHI and CCI.
16. SureWest Telephone, SureWest Long Distance and SureWest TeleVideo provide telecommunications services in California and have sufficient experience and expertise for their continued operations, post transfer of control.
17. CCHI, through its subsidiaries, provides telecommunications services in Illinois, Texas and Pennsylvania. CCHI has sufficient experience and expertise to continue the telecommunications operations of the SureWest Companies post transfer of control.
18. Applicants have provided financial statements that demonstrate the CCHI has access to well over $100,000 in cash or cash equivalent, which is reasonably liquid and available and which is sufficient to cover operating expenses and any deposits third-party carriers may require.
19. In light of the parties' settlement and given the completeness of the Application, the Settlement Agreement and the Joint Motion seeking its approval, the ALJ held no hearings.
20. This Settlement Agreement is an "all party" settlement that commands the unanimous sponsorship of all active parties.
21. The parties to this Settlement Agreement are fairly representative of the affected interests.
22. No term of the Settlement Agreement contravenes statutory provisions or prior Commission decisions.
23. The Settlement Agreement conveys to the Commission sufficient information to permit the Commission to discharge its future regulatory obligations with respect to the parties and their interests.
24. The Settlement Agreement is (1) reasonable in light of the record; (2) consistent with the law; (3) in the public interest; and (4) an acceptable outcome to a pending proceeding that avoids the time, expense and uncertainty of litigation on the issues raised in this application.
25. The proposed transaction, as described in the Joint Application and as modified by the terms of the Settlement Agreement, produces benefits for ratepayers, company employees, small businesses, the local community, and the states communications infrastructure.
26. The proposed transaction, as described in the Joint Application and as modified by the terms of the Settlement Agreement is in the public interest.
27. Approving the proposed transaction, as described in the Joint Application and as modified by the terms of the Settlement Agreement is the relief requested by the Joint Applicants and this relief is not opposed by any party in this proceeding.
1. Where a company that does not possess a California CPCN desires to acquire control of a company or companies that do not possess a California CPCN, the Commission will apply the same requirements, to the acquiring company, as would be applies to an initial applicant seeking a CPCN.
2. CCHI will be the ultimate owner of SureWest Communications and its subsidiaries. CCHI has the financial resources and the technical capabilities that the issuance of a CPCN would require.
3. The settlement between Consolidated, the SureWest Companies, TURN, DRA and Frontier is an all-party settlement and meets the "preconditions" established in D.92-12-019.
4. The transaction, as modified by the Settlement Agreement, is in the public interest, meets the criteria of Section 854(a) of the Pub. Util. Code, and it should be approved.
5. With the filing of the Settlement Agreement, this proceeding becomes an uncontested matter. In approving the transaction and accepting the Settlement Agreement, which modifies the terms of the transaction, we are granting the relief requested.
6. No hearings are necessary.
7. In order to provide timely direction to the parties and any interested persons or entities, this order should be effective immediately.
IT IS ORDERED that:
1. The April 30, 2012 Joint Motion for Adoption of All Party Settlement Agreement Pursuant to Article 12.1 of the Commission's Rules of Practice and Procedure is granted and the Settlement Agreement, Attachment A to this decision, as modified by the May 10, 2012 Amendment to Settlement Agreement found in Attachment B to this decision, is approved.
2. Pursuant to Pub. Util. Code §§ 851-854, the transaction, as described in the joint application of Consolidated Communications Holdings, Inc., Consolidated Communications Inc. and WH Acquisition II Corporation, and SureWest Communications, SureWest Telephone, SureWest Long Distance, and SureWest TeleVideo To Authorize the Acquisition of Control of SureWest Telephone, SureWest Long Distance, and SureWest TeleVideo, is granted subject to the conditions contained in the Settlement Agreement.
3. Within 30 days of the closing of the transaction, the surviving entities shall notify the Communications Division, by letter, of the consummation of the transaction.
4. Application 12-02-011 is closed.
This order is effective today.
Dated June 7, 2012, at San Francisco, California.
MICHAEL R. PEEVEY
President
TIMOTHY ALAN SIMON
MICHEL PETER FLORIO
CATHERINE J.K. SANDOVAL
MARK J. FERRON
Commissioners
