Filed pursuant to Rule 424(b)(3) of the
Securities Act of 1933, as amended, with respect
to Registration Statement No. 333-4226
PROSPECTUS SUPPLEMENT
To Proxy Statement-Prospectus dated June 28, 1996
ICG COMMUNICATIONS, INC.
39,970,232 Shares of ICG Communications, Inc.
Common Stock, $.01 par value per share
_________________________________
This Prospectus Supplement relates to up to 39,970,232
shares of Common Stock, $.01 par value per share (the "Common
Stock"), of ICG Communications, Inc., a Delaware corporation
("ICG"), issuable to the holders of common shares, no par value
per share, of ICG Holdings (Canada), Inc., a Canadian federal
corporation, formerly known as IntelCom Group Inc. ("Holdings-
Canada"), in connection with the Arrangement (as defined below).
This Prospectus Supplement is being issued by ICG for the purpose
of providing additional information not previously included in
the Proxy Statement-Prospectus dated June 28, 1996 (the
"Prospectus") regarding (i) the consummation of the Arrangement,
and (ii) ICG's results of operations for the fiscal year ended
September 30, 1996.
This Prospectus Supplement does not contain complete
information about the Arrangement or the Common Stock of ICG.
Additional information is contained in the Prospectus. Investors
are urged to read both this Prospectus Supplement and the
Prospectus in full. Sales of shares of ICG's Common Stock may
not be consummated unless the investor has received both this
Prospectus Supplement and the Prospectus.
INVESTORS SHOULD CAREFULLY CONSIDER THE INFORMATION SET
FORTH UNDER THE CAPTION "RISK FACTORS," INCLUDING THE RISKS
RELATING TO HISTORICAL AND ANTICIPATED OPERATING LOSSES AND
NEGATIVE CASH FLOW, WHICH BEGINS ON PAGE 21 OF THE PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus Supplement is December 18, 1996
<PAGE>
THE ARRANGEMENT
On August 2, 1996, Holdings-Canada received final approval
from the Ontario Court of Justice of a plan of arrangement (the
"Arrangement") pursuant to which (A) the shareholders of IntelCom
Group Inc. would exchange their Common Shares, no par value, for
either (i) Common Stock of a new publicly traded company
incorporated in the United States, namely ICG, or (ii) Class A
Common Shares, no par value, of IntelCom Group Inc., and (B)
IntelCom Group Inc. would change its name to ICG Holdings
(Canada), Inc. The principal effect of the Arrangement is that
ICG, a U.S. domiciled corporation, has become the public holding
company for Holdings-Canada, and Holdings-Canada is the holding
company for ICG Holdings, Inc., a Colorado corporation, formerly
known as IntelCom Group (U.S.A.), Inc. ("Holdings"), and its
subsidiaries (collectively, the "Company").
Pursuant to the Arrangement, shareholders of Holdings-Canada
exchanged more than 98% of their Common Shares of Holdings-Canada
on a one-for-one basis for shares of Common Stock of ICG. ICG is
now controlled by those former shareholders of Holdings-Canada
who exchanged their Common Shares of Holdings-Canada for shares
of Common Stock of ICG pursuant to the Arrangement. Holdings-
Canada is now controlled by ICG, which holds in excess of 98% of
the outstanding Common Shares of Holdings-Canada.
Approval and completion of the Arrangement was announced by
the Company in a press release dated August 5, 1996, which was
filed as an exhibit to ICG's and Holdings-Canada's Current Report
on Form 8-K dated August 2, 1996.
FINANCIAL INFORMATION
The Company announced in a press release dated December 5,
1996 its results of operations for the period ended September 30,
1996. Set forth herein, in summary form, are the Company's
Consolidated Statement of Operations for the three months ended
September 30, 1996 and June 30, 1996 and the twelve months ended
September 30, 1996 and the Company's Consolidated Balance Sheets
as of September 30, 1996.
-2-
<PAGE>
CONSOLIDATED STATEMENTS OF OPERATIONS
(FIGURES IN THOUSANDS EXCEPT PER SHARE DATA)
TWELVE
MONTHS
THREE MONTHS ENDED, ENDED
SEPTEMBER SEPTEMBER
30, JUNE 30, 30,
1996 1996 1996
--------- -------- ---------
Revenue
Telecom services $32,162 $24,371 $87,681
Network services 15,746 14,679 60,116
Satellite services 5,197 5,596 21,297
Total revenue 53,105 44,646 169,094
Operating costs
Telecom services (29,306) (22,323) (78,705)
Network services (12,631) (10,569) (46,256)
Satellite service (2,728) (2,415) (10,292)
Total operating costs (44,665) (35,307) (135,253)
Selling, general and
admin. (21,397) (20,546) (76,725)
EBITDA (12,957) (11,207) (42,884)
Depreciation and
amortization (8,952) (9,055) (30,368)
Operating loss (21,909) (20,262) (73,252)
Interest expense (23,342) (32,940) (85,714)
Interest income 6,868 5,957 19,300
Other, net (6,039) (466) (9,082)
Share of losses in joint
ventures (555) (449) (1,814)
Provisions for
impairment (9,917) 0 (9,917)
Loss before minority
interest and taxes (54,894) (48,160) (160,479)
Minority interest &
preferred dividend
on subordinated
subsidiary preferred
stock (3,560) (16,561) (25,306)
Income tax benefit 649 0 5,131
Cumulative effect of
accounting change 0 0 (3,453)
Net loss $(57,805) (64,721) (184,107)
Loss per share $(1.91) (2.43) (6.83)
Weighted average number
of shares outstanding 30,296 26,580 26,955
-3-
<PAGE>
CONSOLIDATED BALANCE SHEETS
(FIGURES IN THOUSANDS)
AS OF SEPTEMBER 30,
1996
-------------------
Assets:
Cash, cash equivalents and short-term
investments $457,914
Receivables 40,835
Property and equipment 383,435
Less accumulated depreciation (47,298)
Property and equipment, net 336,137
Other assets, net 104,465
Total assets $939,351
Liabilities and Stockholders' Equity (Deficit):
Accounts payable and accrued liabilities $51,881
Debt 669,784
Capital leases 78,325
Other liabilities 2,851
Total liabilities 802,841
Minority interests 2,780
Redeemable preferred stock of subsidiary 153,318
Stockholders' equity (deficit)
Common stock 275,355
Additional paid-in capital 23,874
Accumulated deficit (318,817)
Total stockholders' equity (deficit) (19,588)
Total liabilities and stockholders'
equity (deficit) $939,351
-4-
