Lumpkin's group regains ICTC

BY CARL WALWORTH City Editor

MATTOON –

A group headed by Richard A. Lumpkin has succeeded in buying Illinois Consolidated Telephone Co.

The announcement that Lumpkin's group is acquiring ICTC from McLeodUSA Inc. in a deal valued at $271 million came in a statement Tuesday evening. The move, once regulators approve, returns ownership of the Mattoon-based company to the family that founded it in 1894.

"I am excited to return Illinois Consolidated Telephone Co. to local ownership to preserve its tradition of quality service," Lumpkin said in a statement. "This will permit ICTC to continue as an active corporate supporter of the communities it serves."

The businesses involved in the sale employ about 700 people in East Central Illinois with the base in Coles County, including senior management and executive positions at the six-story headquarters on 17th Street. Lumpkin said he expects to retain and grow the workforce. "ICTC's employees are the basis of our past and future success," Lumpkin said.

The pending sale has been the subject of intense speculation among employees and community leaders in recent weeks. Many were concerned about the impact locally if Cedar Rapids, Iowa-based McLeod sold the company to a firm based outside the area.

In addition to Lumpkin and members of his family, the new holding company called Homebase Acquisition Corp. is owned by Providence Equity of Rhode Island and Spectrum Equity Investors of Boston.

Lumpkin is to be the chairman of the board with Robert Currey as president, chief executive officer and a board member.

Currey, most recently the vice chairman of RCN Corp. of Princeton, N.J., was president of ICTC until 1997 when he left for a position with McLeodUSA.

"I am especially pleased to welcome Bob Currey back to Mattoon," Lumpkin said. "He shares my admiration of and respect for our employees, one of the strongest groups in the industry. With his extensive knowledge of ICTC's customers and our operations, he is an invaluable asset.

"Bob also joins me in thanking not only our employees for their past contributions but also in thanking the communities we serve for the expressions of support we have received as we have pursued this opportunity ."

The new chief financial officer is to be Donald R. Shassian, who is a former chief financial officer of Southern New England Telecommunications Corp. (SNET) of New Haven, Conn. He is also a former head of the telecom practice at Arthur Andersen. Joe Dively is vice president and general manager.

The transaction, which requires regulatory approval, includes Mattoon-based McLeodUSA Operator Services, Integrated Business Systems, Consolidated Mobile Services and Consolidated Market Response.

The transaction is not expected to have any impact on ICTC's service to customers. In the transaction ICTC also acquires the long distance customer base in its service territory.

ICTC and other subsidiaries of then, Consolidated Communications Inc., was acquired by McLeodUSA in 1997. McLeodUSA announced in December plans to sell ICTC to raise cash to retire debt.

The sale to the Lumpkin-backed group is expected to be complete by the end of the year.

Lumpkin resigned as vice chairman and as a director on the McLeodUSA board in April to consider a potential bid for ICTC.

Contact Carl Walworth at cwalworth@jg-tc.com.