MPOW - Mpower Holding Corporation (MPOW)

[jmhollen]

Florida Digital Network To Acquire Mpower's Southeast Operations and Network Assets

ORLANDO, Fla.--(BUSINESS WIRE)--Jan. 8, 2003--Florida Digital Network, Inc.:

-- FDN Will Acquire Mpower Network Assets and Customers in Miami,
Fort Lauderdale, Tampa Bay and Atlanta

-- The Deal Represents About 77,000 Business and Internet Access
Lines and Marks FDN's First Expansion Outside Its Home State of
Florida

Florida Digital Network, Inc. and Mpower Communications Corp. have entered into a definitive agreement in which Florida Digital will acquire Mpower's customer base and network operations in the Southeast United States. Markets included in the deal are Miami, Fort Lauderdale, West Palm Beach and Tampa where Florida Digital already has a strong market presence, and Atlanta. The Atlanta market represents Florida Digital's first expansion outside its home state of Florida. Financial terms of the deal have not been disclosed.

The Mpower customer base represents approximately 77,000 voice and Internet access lines, close to doubling the size of Orlando-based Florida Digital Network. Network assets included in the package augment Florida Digital's extensive statewide network, providing the company immediate presence in the Clearwater/St Petersburg area, and bolstering capacity in its other markets.

"We are already one of the strongest regional competitors in the telecom industry and we believe this deal gives us the size and strength to provide real competition to the local monopolies," said Mike Gallagher, Florida Digital's CEO. "We are very excited about the opportunities this rapid growth presents. The presence in Georgia, the immediate expansion into Clearwater and St. Pete, and the introduction of some new technologies will allow us to provide more options to more consumers."

The deal is subject to regulatory approval in both Florida and Georgia. Gallagher is confident, however that this hurdle will be cleared. "We are confident the regulatory bodies will recognize this merger is good for both companies, good for competition, and as such, good for consumers," said Gallagher.

Florida Digital Network recently surpassed the 100,000 access line mark, a real accomplishment in a struggling economy and a widely troubled industry. This acquisition represents an approximate 70% increase in total lines served and validates the business plan of this regional communication company.

"We have stayed focused on our region and our core customers," reflected Gallagher. "While this is certainly a large expansion for us, it is in line with our business model and allows us to continue to build on our strengths. Executing this merger is well within our capabilities and will not greatly impact our existing customer base," Gallagher concluded.

Existing Mpower customers should see no negative impact according to Gallagher. "Mpower customers can rest assured that they will see no interruption in their service. In fact, they will soon start to realize many benefits from being a Florida Digital customer." One of the benefits to which Gallagher alluded is Florida Digital Network's SunDial(TM) calling plan that provides penny ($0.01) per minute toll calling between all Florida Digital Network customers throughout Florida and soon into Georgia.

To facilitate the integration, Florida Digital Network will begin a rapid hiring phase substantially increasing its workforce in all departments and locations. According to Matt Blocha, President and Chief Operating Officer of FDN, as many as 100 new positions will be created in the immediate future. Many current Mpower employees will be tapped to fill these positions. Blocha however, encouraged all job seekers with telecom experience to contact FDN Human Resources via the company's web site, FDN.COM. This hiring phase will bring the total number of employees at Florida Digital Network to over 500.

Florida Digital Network is a full-service Integrated Communications Provider (ICP), offering a complete suite of telecom services, including local telephone service, long-distance, Internet access and related services. FDN is a facilities-based carrier, providing service with its own telecommunications switching gear, which it installs in the central offices of incumbent carriers.

The company launched service in Orlando in April 1999, in Fort Lauderdale in May 1999 and in Jacksonville in June of the same year. In each of those markets, Florida Digital installed Class 5 telephone switching gear, providing the underlying engineering foundation upon which the company offers service. From those beginnings, Florida Digital has steadily expanded its reach into more Florida markets than any other alternative telephone carrier in the state.

About Mpower

Mpower Holding Corporation (OTCBB:MPOW) is the parent company of Mpower Communications, a facilities-based broadband communications provider offering a full range of data, telephony, Internet access and Web hosting services for small and medium-size business customers.

About Florida Digital Network

Headquartered in Orlando, Florida Digital has steadily expanded its service territory from Jacksonville to Miami to Tampa Bay over the past three years, and now has more than 100,000 business telephone lines in service, more than any alternative carrier in the state. Florida Digital offers a complete line of communications services, including: local and long distance voice, Internet access, Virtual Private Networking (VPN), Web Hosting and Integrated voice and data (DSL) services to businesses throughout Florida.


CONTACT: Florida Digital Network, Orlando
Kevin Smith, 407/835-0595
[e-mail]