Mpower talking to bondholders, no longer says funded into 2003

New York, Feb. 7 - Mpower Holding Corp. said it is in discussions with an ad hoc committee of holders of its senior notes due 2010 about a possible financial restructuring.

The Rochester, N.Y. telecommunications company also said it could no longer confirm previous guidance that it has enough cash to fund operations into the first quarter of 2003.

Mpower announced in September that its business plan was no longer fully funded although at that point it said it had sufficient resources to take it into early 2003.

At the same time it said it had hired Rothschild Inc. as a financial advisor to evaluate strategies to strengthen its balance sheet.

Thursday, Mpower said it continues to work with Rothschild.

In addition to beginning discussions with the bondholder committee, the company said it has begun preliminary discussions with existing and potential equity and debt investors over further investments in the company.

Mpower said it ended 2001 with $183 million in cash, cash equivalents and restricted and unrestricted investments after capital expenditures of $14 million in the fourth quarter.

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