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Level 3 buys Global Crossing for $3b

12 Apr 2011
00:00
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Level 3 has arranged to acquire fellow Tier 1 network operator Global Crossing in an all-stock deal worth $3 billion.

The deal will create an operator with fiber and other networks in around 50 countries throughout North America, Latin America and Europe, and subsea cable network connections to more than 70.

The combined company would have had 2010 revenues of $6.2 billion.

Under the terms of the deal, Colorado-based Level 3 will pay $1.9 billion worth of stock Global Crossing shareholders, and assume $1.1 billion in debt.

Global Crossing's 60% shareholder, Singapore's ST Telemedia, has agreed to the deal. The company will become the largest shareholder in a combined entity with a presence on the board.

Global Crossing owns a number of international subsea cables, including rights of use on the PC-1 and EAC cable systems, focusing on operators based in Asia.

Together, the two companies also have extensive metro and intercity networks in a number of North and Latin American and European countries.

The companies expect the merger to reduce capital expenditure by around $40 million per year.

The deal will be subject to regulatory approvals.

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