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Mercator Partners IPO Raises $59.5 Million

Money to Finance Telecom Acquisition

By Terence O'Hara
Washington Post Staff Writer
Saturday, April 16, 2005; Page E02

Mercator Partners Acquisition Corp. raised $59.5 million in an initial public stock offering yesterday and plans to use the money to buy a telecommunications business.

According to Securities and Exchange Commission filings, Reston-based Mercator Partners sold 575,000 Series A units and 5,290,000 Series B units, each unit containing different classes of common stock and warrants to buy stock.

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Mercator officials declined to comment, citing SEC "quiet period" rules.

The company is managed by Mercator Capital, a privately held Reston investment bank specializing in mergers and acquisitions of telecommunications, defense and information technology companies.

A newly public entity, Mercator Partners is organized as a "blank check" company. In effect, Mercator Partners is now a cash-laden shell that will not be an operating company until it buys one. According to SEC filings, Mercator Partners will buy a company in the telecommunications business, though it has yet to identify a potential acquisition target.

H. Brian Thompson, 65, a veteran telecommunications industry executive in the Washington area, is Mercator Partners' chairman and chief executive. Three Mercator Capital partners, Rhodric C. Hackman, Lior Samuelson and David Ballarini, are also executives.

Morgan E. O'Brien, vice chairman of Nextel Communications Inc., and Alex Mandl, former chief executive of Teligent Inc., are special advisers to Mercator Partners.

Mercator's Class A units were underwritten for $10.50 a share by New York investment bank HCFP/Brenner Securities. The Class A units did not trade yesterday. The Class B units were sold for $10.10 a share, and closed yesterday at $10.40 a share on light trading.

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