Re: Probably Not Going to Help
said by pnh102:
If these rural markets are not profitable for Verizon, then there's still nothing stopping them from selling them off anyway.
No, there is not, but it would be less tempting/expensive to do, without the tax break, provided by the RMT.
The intent of the RMT was to allow Corp. to spin off SUCCESSFUL divsions into seperate businesses, IF they no longer matched the Corp.s core business, without excess tax liability for either the parent, shareholders, or the new business. A valuable tool for de-consolidating businesses before they became "too large to fail".
However, it didn't have the safegaurds to prevent it from being used to dump unwanted assets and DEBT onto the discarded portions, benefiting ONLY the parent.
Don't know if it should be illegal, but the conditions should be HIGHLY regulated against these abuses.
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Re: Probably Not Going to Help
said by tshirt:You could make the argument that these divisions were successful. If they were failures, in terms of not making a profit, Verizon would have pulled the plug on them on their own, with or without selling them off.
The intent of the RMT was to allow Corp. to spin off SUCCESSFUL divsions into seperate businesses ...
The problem in Verizon's eyes were that these areas were profitable, but not profitable enough. In all the cases, you can easily note the mistakes that were made by the companies that bought these assets. They quickly turned something that was moderately profitable into a loser.
"Net Neutrality" zealots - the people you can thank for your capped Internet service.
Re: Handwriting on the wall..
said by unoriginal:When Verizon became the premier telco long before AT&T got self made with BellSouth they acquired GTE so they are part of the landscape of California telco. If you look carefully at the deal assets had to switched back & forth so that the deal could pass anti-trust. No doubt some CA municipalities got switched around and some former PacBell assets wound up in Verizon hands too as part of the deal and some GTE assets went to Pacbell. What happened after is irrelevant.. to how Verizon.. a former northeast telco wound up with West Coast telecom wireline assets in the last mile.
Pacbell isn't part of Verizon. We here in California are part of Ma Bell aka AT&T.
Verizon transaction exempt from law Before everyone gets real excited about this affecting the current Verizon spin off to Frontier, there is a provision in the law that exempts any transaction that was agreed to in a contract BEFORE Mar 15, 2010. I guess it will be up to the lawyers on whether Verizon & Frontier already have a binding agreement.
Go to page 43 of the PDF report on the law
The provision applies to exchanges occurring after the date of enactment.The actual bill. See Sec 302 for who is exempted from the law because of effective date:
However, the provision does not apply to any exchange in connection
with a transaction which is (i) made pursuant to an agreement
which was binding on March 15, 2010, and at all times thereafter,
(ii) described in a ruling request submitted to the Internal Revenue
Service on or before such date, or (iii) described on or before such date in a public announcement or in a filing with the Securities
and Exchange Commission.
(c) Effective Date-Looks to me like Verizon already has their loophole in the bill already.
(1) IN GENERAL- Except as provided in paragraph (2), the amendments made by this section shall apply to exchanges after the date of the enactment of this Act.
(2) TRANSITION RULE- The amendments made by this section shall not apply to any exchange pursuant to a transaction which is--
(A) made pursuant to an agreement which was binding on March 15, 2010, and at all times thereafter,
(B) described in a ruling request submitted to the Internal Revenue Service on or before such date, or
(C) described on or before such date in a public announcement or in a filing with the Securities and Exchange Commission.
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