
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, April 10, 1990                   TAG: 9004100200
SECTION: BUSINESS                    PAGE: A7   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Short

MCI BUYS NO. 4

MCI Communications Corp., seeking greater inroads into the long-distance market dominated by AT&T, said Monday it would spend $1.25 billion to acquire Telecom USA Inc.

MCI, the nation's second-largest long-distance company, said acquisition of the No. 4 carrier, active in the Midwest and Southeast, would bring an immediate boost in customers and open new areas of technology and service to MCI.

Under terms of the deal, which has been approved by the boards of directors of both companies, MCI would acquire all outstanding shares of Telecom USA's common stock for $42 a share, the two companies said in a joint statement.

Telecom shares jumped $16.25 to $38.12 1/2 a share on the New York Stock Exchange. MCI, traded in the over-the-counter market, dropped $1.12 1/2 to $35.75.

The transaction is subject to approval by Telecom's stockholders. The Federal Communications Commission would also have to grant approval and the Justice Department would review whether the deal would violate antitrust laws.

AT&T has 64 percent of the long-distance market, down from about 90 percent before the 1984 breakup of the old Bell System in 1984. MCI has 12 percent and Sprint is third with 9 percent, according to recent FCC figures.

by CNB