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Adelphias Hyperion Unit Files For $150m IPO

Coudersport, Pa. -- Seeking to tap a hot market for
competitive local-exchange carrier (CLEC) stocks, Adelphia Communications Corp.'s
Hyperion Telecommunications Inc. unit has filed for an initial public offering valued at
around $150 million.

Adelphia owns 79 percent of Hyperion, and it had tried in
1996 to sell a piece to the public for around $200 million. Adelphia withdrew that
offering, citing market conditions. CLEC stocks have been potent the last several months,
though. According to Bear Stearns & Co. CLEC analyst James Henry, CLEC stocks he
tracks rose 37 percent in the first quarter, compared with an 11 percent rise in the Dow
Jones Industrial Average and a 20.5 percent gain in Bear Stearns' Tech Index.

A March 18 filing at the Securities and Exchange Commission
said the proceeds would go for capital projects and possibly toward increasing its stake
in existing CLEC networks. Most Hyperion networks were built with local cable systems or
utilities as partners, but Hyperion has been rolling up some of those partnerships, and
now owns about 76 percent of those operating companies.

Hyperion sells telecommunications services to long-distance
carriers and businesses using 18 fiber networks in 46 cities, mostly in the Northeast. It
has plans to add 14 new networks in 29 cities over the next 18 months, according to the
SEC filing.

While Hyperion's revenue has risen -- to $8.7 million
for the first nine months of the last fiscal year from $3.6 million in the same period the
prior year -- its operating losses have risen, too. Hyperion lost $12.7 million in the
nine months leading up to Dec. 31, 1997, compared with $6 million the year before. And
with plans to expand networks and increase sales and marketing forces, Hyperion figures it
will need $420 million for plant expansion, working capital and operating losses through

One wild card in those figures: Hyperion is bidding on
local multipoint distribution service (LMDS) licenses for broadband, fixed-wireless
service. If it wins licenses and is obligated to build LMDS systems, that will add to its
expenses. Hyperion had $722.7 million in debt and redeemable preferred stock outstanding
at the end of December.

Salomon Smith Barney will be managing director of the
offering, with Credit Suisse First Boston and NationsBanc Montgomery Securities LLC
serving as co-managing underwriters. Hyperion's proposed NASDAQ trading symbol is