**Editor’s Note: Please click


here

for a recap of the biggest channel-impacting mergers of Q3 2012 or here for the biggest M&A during Q2 in the service-provider and BSS/OSS spaces.**

Colorado-based CLEC tw telecom might soon be a part of phone and Internet giant CenturyLink.

tw telecom has been working closely with investment firm Evercore Partners on a potential sale for the past several weeks, according to DealReporter’s sources, who also suggested that CenturyLink and the CLEC “could be near a deal.” Just the mention of a merger possibility helped tw telecom stock jump more than 4 percent Monday.

One of the sources said Level 3 has also shown interest in tw telecom, but the cost might prove to be too much for the multinational communications and Internet services provider, which is mired in debt. All of the companies mentioned in the report declined to comment.

Getting a deal done will be no easy feat for CenturyLink, which also has a debt problem; it’s almost $20 billion in the hole. That’s affecting its credit rating and will surely impact any offer the company can make, DealReporter pointed out.

CenturyLink has made growth via acquisition a goal over the past several years. The company bought Savvis, a data center operator, for $2.3 billion last year; Qwest for more than $10 billion in 2011 as well; and rural LEC Embarq for nearly $6 billion in 2009.

tw telecom sells business-class managed voice, Internet and data network services to enterprises and communications services companies in the U.S. and around the world. Those services include Ethernet; transport data networking; Internet access; local and long distance voice; and VoIP.