Mpower Formally Folded Into TelePacific

The money has officially changed hands and Mpower Communications Corp. now belongs to Los Angeles-based TelePacific Communications.

The deal was announced in May and was financed by Credit Suisse and Bank of America. TelePacific paid approximately $204 million for Mpower and is transforming Mpower from a publicly traded corporation to a privately held one. The acquisition means TelePacific now has 800,000 access lines serving 75,000 business, residential and wholesale accounts in California, Chicago and Las Vegas.

In the face of RBOC consolidation, combining TelePacific and Mpower makes sense, said Ken Bisnoff, senior vice president of strategic opportunities for TelePacific. It makes a tougher company to compete against, he said.

To that end, TelePacific executives plan to spend time with Mpower officials, learning the nuances of the Chicago market. Some Mpower leaders will work on a retainer basis, but well-known names including that of Rolla Huff, Mpowers chairman and CEO will not be on the permanent staff of the new TelePacific. Keeping Mpower heads would have resulted in redundancy in TelePacifics executive team, Bisnoff said.

The only senior executive who will move over to TelePacific is Russ Shipley, who ran Mpowers wholesale and network services. Because this acquisition marks TelePacifics first foray into the wholesale market, the company needs Shipleys expertise, said Bisnoff, who noted, The entire Mpower team should be very proud of the company theyve built and particularly the agent team theyve built Theyve gained a lot of respect from me. The more weve dug in and worked hand-in-hand with Mpower executives has only added to that respect.

Over the next week or so, TelePacific will announce which of Mpowers products it will add to its portfolio. Mpower has tremendous network assets and were going to be able to get a significant amount of synergies, Bisnoff said. He added TelePacific will communicate extensively with agents and also avoid any dramatic, sudden jolts for those salespeople.

J.R. Cook, who oversaw Mpowers alternate channels division, will join TelePacific to work with agents. Bisnoff said Mpowers agents and skills really will fit well within the TelePartner program.

TelePacific plans to simply fold Mpower agents into its family, Bisnoff said. The provider will be rolling out its agent agreements soon, and will make sure products and back-office operations are not duplicated.

Theres going to be a lot of consistency in what agents dealt with yesterday versus what theyre going to deal with on Monday, Bisnoff said.

TelePacific Communications www.telepacific.com