Updated from 10:01 a.m.

Telecom concern

CoreComm

(COMM) - Get Report

agreed Friday to buy privately held

ATX Telecommunications Services

for $900 million in cash and stock, enabling CoreComm to expand in the mid-Atlantic states.

Under the terms of the deal, New York-based CoreComm will pay 12.4 million shares, or $500 million worth, of its common stock; $250 million of 3% convertible preferred stock; and $150 million in cash. The preferred stock is convertible into common stock at a price of $44.36.

CoreComm's shares gained 6 11/16, or 16.2%, to close at 47 7/8 on Friday.

In the past year, CoreComm has sought to build its capabilities, acquiring both

MegsInet

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, a national Internet network and regional Chicago-based telecommunications provider, and certain assets of

USN Communications

, a regional local exchange telecommunciations provider also based in Chicago, last June.

The company offers telephone, Internet and data services to business and residential customers throughout the U.S.

Philadelphia-based ATX offers local service in Philadelphia and is expanding that service into New Jersey, Baltimore and Washington, D.C. The company has about 20,000 small and medium-sized business customers.

The transaction is expected to close during the summer of 2000.

In the past year, CoreComm has sought to build its capabilities, acquiring both

MegsInet

, a national Internet network and regional Chicago-based telecommunications provider, and certain assets of

USN Communications

, a regional local exchange telecommunciations provider also based in Chicago, last June.

The company offers telephone, Internet and data services to business and residential customers throughout the U.S.