Sandwich Isles bids $400M for Hawaiian Telcom - Kansas City Business Journal:

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, a company founded in 1995 to take advantagr of government subsidies that pay for the installatiojn of broadband cable in rural said in a court filing last week that it wants to buy all ofHawaiiah Telcom’s assets. The company said it would retain all ofHawaiiahn Telcom’s 1,400 workers at their currenr wages, with the exception of senio management. Sandwich Isles said in the filintg that its offer would consisgof $250 million in cash plus $150 milliojn in debt issued by Hawaiian Telcom. A deal with Sandwicjh Isles would require the approval of abankruptcy judge, the Publidc Utilities Commission and the Federal Communication Commission.
Hawaiian Telcom said in a statementf that it stands behind its proposedreorganizationh plan, filed in June, to reduce the company’sx debt by nearly $790 million, from $1.1 billion to $300 Hawaiian Telcom filed a motiojn seeking an extension to file a Chapterd 11 plan and solicit votes. Judgd Lloyd King extended that periodx toJune 30. The company is seeking another extensionto Sept. 30. Sandwicn Isles has filed an objection to thelates request.
“In the objection, Sandwich Isles makes numerousd allegations about the progress Hawaiian Telcom has made to date inthesse cases, Hawaiian Telcom’s decision not to pursur a sale to Sandwichy Isles and the viability of Hawaiian Telcom’s proposedd plan,” Hawaiian Telcom said in a “The company disputes these allegations and intendsx to respond to Sandwich Isles objection in the appropriats forum.
” Sandwich Isles was founde by Al Hee, an entrepreneur who saw opportunityt in the generous subsidies offered by the federalk government to wire rural and remote communities in the Working primarily in developments owned by the state Departmentr of Hawaiian Home Lands, Hee’s company has receivec more than $400 million in loansd from the U.S. Department of Agriculture since 1998. The cost of wiring the ruralo developments has been calculated atabouty $13,000 per customer. Hawaiian Telcoj filed for Chapter 11 bankruptc yin December. Hawaiian Telcom is ownef by , a Washington, D.C.-based private equitu group. Carlyle bought the assetsd of Verizon Hawaii in May 2005for $1.
6 and began operating independently with its own system in April 2006.