CenturyLink to buy Level 3 Communications for $19.43 billion in a cash-and-stock deal

A woman uses her mobile phone in central London September 2, 2013. REUTERS/Stefan WermuthA woman uses her mobile phone in central London September 2, 2013. REUTERS/Stefan Wermuth

CenturyLink Inc will buy Level 3 Communications Inc in a cash-and-stock deal for equity value of $19.43 billion to expand its fiber optic network and high-speed data services. The deal comes at a time when clients need faster capabilities to run their businesses.

Telecom company CenturyLink Inc said on Monday it would buy Level 3 Communications Inc in a cash-and-stock deal for equity value of $19.43 billion to expand its fiber optic network and high-speed data services. CenturyLink will offer $26.50 in cash and 1.4286 of its shares for each Level 3 share held.

The deal would combine Level 3’s enterprise services with CenturyLink’s network that provides internet and telephone offerings to millions of customers. Including debt, the deal is valued at about $34 billion. The merger, for about $66.50 per share, is at a premium of 42 percent from Level 3’s Wednesday close. The deal marks a successful end to the advanced negotiations the companies were in on Thursday.

The deal comes at a time when business clients of both companies seek more bandwidth and faster capabilities to move data to run their businesses. This merge, expected to close by the end of the third quarter of 2017, will increase CenturyLink’s network by 200,000 miles of fiber.

CenturyLink shareholders will own about 51 percent of the combined company and the rest by Level 3 shareholders.

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