Hawaiian Telcom is moving forward with plans to issue shares after receiving final regulatory approval to exit bankruptcy.

The Public Utilities Commission yesterday approved Hawaiian Telcom’s reorganization plan. The company said it hopes to finalize documents and officially emerge from bankruptcy protection within 30 days. The PUC’s approval followed last week’s endorsement by the Federal Communications Commission.

Hawaiian Telcom said the reorganization will not affect its rates or terms of service for customers. The company also told the PUC that it "intends to retain generally all" of its 1,450 employees.

"We are extremely pleased with the PUC’s approval today, which concludes the regulatory approval process," said Eric Yeaman, Hawaiian Telcom president and chief executive officer.

Hawaiian Telcom filed for bankruptcy protection in December 2008 due to its heavy debt load and the loss of thousands of customers to wireless and other competitors.

One of the projects Hawaiian Telcom was forced to put on hold when it filed for bankruptcy was a plan to offer television programming over its phone lines. Hawaiian Telcom filed an application for a cable franchise license from the state in 2006, but ran into financial difficulties before it was able to follow through on the plan.

"Our plan of reorganization creates a business structure which allows us to grow and flourish, Yeaman said in a news release. "In the very near future, we will be announcing and unveiling exciting new plans."

The PUC said that under the reorganization plan, Hawaiian Telcom will be able to reduce its debt to about $300 million from $1.1 billion. The plan also provides for at least $52 million of cash on hand and a revolving loan fund of up to $30 million for general corporate purposes.

Under the plan, Hawaiian Telcom and its parent company "will be more financially stable than they were prior to entering bankruptcy," according to the PUC filing.

About $600 million of senior secured debt will be converted to $160 million in common stock, according to the filing. Hawaiian Telcom also plans to issue a new $300 million senior secured loan maturing in five years. That would result in ratio of 65 percent debt to 35 percent equity that the PUC had set as a target.

A private equity firm that controls some of the top luxury hotels in the state will become Hawaiian Telcom’s largest investor.

Cerberus Capital Management LP will own 16.7 percent of Hawaiian Telcom once the company emerges from bankruptcy protection, according to filings with the Federal Communications Commission.

Cerberus will not have a controlling interest in Hawaiian Telcom and so far, the firm’s investment has been largely passive.