Level 3 Communications to acquire ICG Communications for $163 mn

04/17/06 - newratings.com

NEW YORK, April 17 (newratings.com) – Communication and Information Services provider, Level 3 Communications Inc (LVLT), Monday announced that it has agreed to acquire ICG Communications for $163 million in stock and cash.

Broomfield, Colorado-based Level 3 Communications said that it would issue unregistered shares worth $127 million, along with $36 million in cash, to acquire ICG Communications. Kevin O'Hara, Level 3 Communications’ President and COO, said that the acquisition presents the company with an opportunity to realise cost savings. Level 3 Communications said that ICG Communications, on a standalone basis, is likely to generate close to $75 million-$80 million in annualised revenues and about $10 million-$15 million in annualised positive cash flows going forward, following capital expenditures of nearly $10 million. The deal, which is expected to be completed during mid-year 2006, excludes ICG Communications’ investments in Mpower Holding or New Global Telecom, MSN Money added.