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FCC Finally Approves CenturyLink's Level 3 Buy

CenturyLink's acquisition of Level 3 creates the second-largest domestic communications provider serving global enterprise customers.

Edward Gately

October 30, 2017

2 Min Read
Merger

**Editor’s Note: Please click here for a recap of the biggest channel-impacting merger and acquisition news from August.**

Roughly a year since it was announced, CenturyLink has received all of the necessary regulatory approvals to complete its $34 billion acquisition of Level 3 Communications.

After more than 190 days of review, the Federal Communications Commission has approved the merger, following approvals by the U.S. Department of Justice and the California Public Utilities Commission (CPUC). The merger creates the second-largest domestic communications provider serving global enterprise customers.

“The FCC’s approval of CenturyLink’s acquisition of Level 3 is great news and means we now have all the regulatory approvals we need to close the transaction,” said John F. Jones, CenturyLink’s senior vice president for public policy and government relations. “We anticipate closing the transaction effective Nov. 1, 2017.”

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Michael Finneran

From relatively humble beginnings, CenturyLink has grown to be a major player in the carrier service market, said Michael Finneran, industry analyst and Channel Partners contributor.

“Starting with its acquisition of Embarq in 2008, CenturyLink has been on an acquisition binge that has seen them gobble up Qwest (2010), cloud services provider Savvis (2011), PaaS provider AppFog (2013), IaaS provider Tier 3 (2013), predictive analytics firm Cognilytics (2014) and now Level 3,” he said. “This is a part of an ongoing wave of mergers and acquisitions in the carrier space, and leaves CenturyLink with a full portfolio on the wired side but virtually no presence in wireless.”

The combined company is required to sell off Level network assets in three metro areas: Albuquerque, New Mexico; Boise, Idaho; and Tucson, Arizona. It also will divest 24 strands of dark fiber connecting 30 specified city-pairs across the country in the form of an Indefeasible Right of Use, a customary structure for such transactions.

In addition to California, approvals were obtained in 16 states and the District of Columbia. The transaction also received regulatory clearance from Connecticut, Indiana, Louisiana, Montana, Nevada, Texas and Puerto Rico.

The combined company will offer customers a broader and more complementary range of services and solutions, and enable the advanced technology and growing bandwidth needs of its business, government and consumer customers, CenturyLink said.

You’ll hear more from Channel Partners later this week on how the acquisition will impact solution providers.

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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