Level 3 to buy Broadwing for USD1.4 billion

Level 3 Communications has agreed to buy telecoms company Broadwing in a cash and stock deal worth USD1.4 billion. The acquisition will give Level 3 access to Broadwing's corporate customer base as well as its 19,000-mile fibre-optic network. Under the terms of the agreement, Broadwing shareholders will get USD8.18 in cash and 1.3411 shares of Level 3 stock. The acquisition, which still requires regulatory and shareholder approval, is expected to close in 1Q 2007.

Originally known as Corvis Corp when it was launched in the late 1990s, Broadwing now offers services in 20 US states, including Maryland and Virginia. According to Level 3 President and Chief Operating Officer Kevin O'Hara, the acquisition – the company’ sixth this year - will enable Level 3 to put Broadwing's customers on its network and eliminate duplication. Current Broadwing customers include Deutsche Lufthansa, W.W. Grainger and Big Lots.