Shareholders have given CenturyLink the green light to buy
Level 3 Communications in a deal valued at around $32.5
96.3% of CenturyLink and 81.2% of Level 3’s
shares voted in favour of the deal, which is set to be
completed in September if approved by regulators.
The deal will add Level 3’s 200,000 mile fibre
network to CenturyLink’s existing 250,000 route
mile US network and 300,000 route mile international transport
network. CenturyLink currently has the third largest fibre
network in the US, after AT&T and Verizon, and this deal
will take it nearer to its rivals.
"The combination of CenturyLink and Level 3 will
significantly improve our global network capabilities, creating
a company with one of the most robust fibre networks in the
world," said Glen Post, chief executive officer and president
"This expanded network should allow us to bring substantial
operational and service benefits to our enterprise customers,
as well as an enhanced customer experience."
The merger has already received a number of approvals from
state regulators, including Georgia and West Virginia and
clearances in Connecticut, Indiana and Louisiana. CenturyLink
said it expects regulatory approval from remaining state,
federal and international regulators in time to complete the
deal by 30 September.
Upon closing of the transaction, Level 3 stockholders will
receive $26.50 per share in cash and 1.4286 shares of
CenturyLink stock for each Level 3 share they own. This means
the value of the deal, reported as $34 billion when it was
first announced in October, has fallen by around $1.5
Once the acquisition is closed, CenturyLink shareholders
will hold around 51% of stock, while Level 3’s
shareholders will take around 49% of the combined company,
which will be headquartered in Monroe, Louisiana.
Post added: "We appreciate the strong support from our
shareholders for the merger and their recognition of the
benefits the combined company will bring. We're making solid
progress with our regulatory approvals and remain optimistic
that the process will continue smoothly with the remaining
The approval comes just a week after CenturyLink CFO Stewart
CenturyLink is to likely to reduce its capital expenditure
significantly thanks to synergies with Level 3.