The much anticipated and discussed merger between Level 3 Communications® and CenturyLink® recently got the regulatory approval from the US Department of Justice (DOJ) under certain conditions that include court approval for some of the provisions.
The pending merger is still awaiting regulatory approval from the California Public Utilities Commission and the Federal Communications Commission (FCC) together with many customary closing conditions. It is expected that the deal will be closed in the third quarter of 2017, if approved by regulatory agencies.
Conditions to Grant Approval
The combined entity formed after the merger plans to divest some dark fiber assets and metro network assets of Level 3 Communications®, as per the decisions. These divestitures will not be affecting the operating cash flow and pro forma revenue of the combined entity. Level 3 Communications® is one of the biggest internet providers in the world and leading fiber optic internet provider of the country.
As per the statute, the combined business will have to divest the metro network assets of Level 3 Communications® to three metro areas Tucson, AZ, Albuquerque, NM, and Boise, ID. The combined business will continue serving all the current customers of Level 3 Communications®, unless they opt to be served by the buyer of the assets.
CenturyLink® will be retaining all their existing business operations and networks in the metro areas. They will continue offering a full suite of data and telecommunication services to business and residential users. As per the clause, the combines business will be divesting 24 strands of dark fiber and this will connect thirty specified pairs of city across the nation. These fibers are not being used for commercial purpose presently. Therefore, the divestiture will not affect any of the current services or customers.
Twenty-four states and territories already approved the merger that was announced on November 2016. The combined business made after the merger will provide the users a more complementary range of solutions and services to offer the advanced technology to meet the growing bandwidth requirements of consumer, business, and government users.
Telecom experts say that the completion of the merger will increase the network of CenturyLink® by 200,000 route miles of fiber. This includes 64,000 route miles in the 350 metro areas of the country and 33,000 subsea route miles that connect multiple continents. The on-net buildings of CenturyLink® are expected to increase about 75% to reach 75,000, which include 10,000 buildings in Middle East, Europe, Africa, and Latin America.