Broadwing Corporation to be Acquired by Level 3 Communications, Inc.
October 17 2006 - 8:02AM
Business Wire
Broadwing Corp. (NASDAQ:BWNG) today announced that it has signed a
definitive agreement to be acquired by Level 3 Communications, Inc.
(NASDAQ:LVLT). Under the terms of the agreement, Level 3 will pay
$8.18 in cash plus 1.3411 shares of Level 3 common stock for each
share of Broadwing common stock outstanding at closing. Based on
yesterday�s $5.32 closing price of Level 3�s common stock, each
share of Broadwing stock would receive consideration equivalent to
$15.31 per share. The actual value of the consideration received by
Broadwing stockholders at closing will depend on Level 3�s share
price at such time. �Bringing together the resources and talents of
Broadwing and Level 3 is an exciting opportunity for our company,
allowing us to capitalize on the strengths of both companies and on
advances in technology,� said Steve Courter, CEO of Broadwing
Corporation. �The combination of our two operations will create a
powerful company in the global telecommunications industry with
strong growth potential.� Closing is subject to customary
conditions, including receipt of applicable state and federal
regulatory approvals, and is also subject to the approval of the
stockholders of Broadwing. Closing is expected to occur in the
first quarter of 2007. Broadwing was advised on the transaction by
Thomas Weisel Partners LLC. Goldman, Sachs & Co. provided a
fairness opinion to Broadwing. Broadwing received legal
representation from Greenberg Traurig, LLP. About Broadwing
Corporation Broadwing Corporation, through its consolidated
subsidiary Broadwing Communications, LLC, delivers innovative data,
voice, and media solutions to enterprises and service providers.
Enabled by its one-of-a-kind, all-optical network and award-winning
products and services, Broadwing Communications provides
communications solutions with unparalleled customer focus and
speed. For more information, visit www.broadwing.com. Broadwing and
its logo are trademarks and/or service marks of Broadwing
Communications, LLC, and/or Broadwing Corporation. All trademarks
and service marks not belonging to Broadwing are the property of
their respective owners. This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, but are not limited to, (i) statements about
the benefits of the acquisition of Broadwing by Level 3, including
financial and operating results, synergy benefits that may be
realized from the acquisition; Level 3�s and Broadwing�s plans,
objectives, expectations and intentions and other statements
contained in this press release that are not historical facts; and
(ii) other statements identified by words such as �expects,�
�anticipates,� �intends,� �plans,� �believes,� �seeks,� �estimates�
or words of similar meaning. These forward-looking statements are
based upon management�s current beliefs or expectations and are
inherently subject to significant business, economic and
competitive uncertainties and contingencies and third-party
approvals, many of which are beyond our control. The following
factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements:
(1) whether the stockholders of Broadwing approve the proposed
transaction; (2) the satisfaction of the other conditions specified
in the merger agreement, including without limitation the receipt
of required governmental approvals of the proposed transaction; (3)
the ability to successfully combine the businesses of Level 3 and
Broadwing; (4) the realization of revenue and cost synergy benefits
from the proposed transaction; and (5) operating costs, customer
loss and business disruption following the merger, including
adverse effects on relationships with employees. Other important
factors that may affect Level 3�s and the combined business�
results of operations and financial condition include, but are not
limited to: increasing the volume of traffic on Level 3�s network;
developing new products and services that meet customer demands and
generate acceptable margins; successfully completing commercial
testing of new technology and information systems to support new
products and services, including voice transmission services;
stabilizing or reducing the rate of price compression on certain of
our communications services; integrating strategic acquisitions
including the acquisition of Broadwing; attracting and retaining
qualified management and other personnel; and the ability to meet
all of the terms and conditions of our debt obligations. Level 3�s
Annual Report on Form 10-K, subsequent Quarterly Reports on Form
10-Q, recent Current Reports on Form 8-K and other Securities and
Exchange Commission filings discuss the foregoing risks as well as
other important risk factors that could contribute to such
differences or otherwise affect our business, results of operations
and financial condition. The forward-looking statements in this
release and the related conference call for analysts and investors
speak only as of the date they are made. Level 3 and Broadwing do
not undertake any obligation to update any forward-looking
statement to reflect circumstances or events that occur after the
date such forward-looking statement is made. This press release
shall not constitute an offer of any securities for sale. The
proposed transaction will be submitted to Broadwing�s stockholders
for their consideration. Level 3 and Broadwing will file a
registration statement, a proxy statement/prospectus and other
relevant documents concerning the proposed transaction with the
SEC. Stockholders of Broadwing are urged to read the registration
statement and the proxy statement/prospectus and any other relevant
documents filed with the SEC when they become available, as well as
any amendments or supplements to those documents, because they will
contain important information. Stockholders of Level 3 can obtain
more information about the proposed transaction by reviewing the
Form 8-K to be filed by Level 3 in connection with the announcement
of the transaction, and any other relevant documents filed with the
SEC when they become available. You will be able to obtain a free
copy of the proxy statement/prospectus, as well as other filings
containing information about Level 3 and Broadwing, at the SEC�s
Web site (http://www.sec.gov). Copies of the proxy
statement/prospectus and the SEC filings that will be incorporated
by reference in the proxy statement/prospectus can be obtained,
without charge, by directing a request to Level 3, Investor
Relations, 1025 Eldorado Blvd., Broomfield, CO 80021, 720-888-2500
or to Broadwing, Investor Relations, 1122 Capital of Texas Highway
South Austin, TX 78746-6426, (866) 426-7847. Level 3, Broadwing and
their respective directors and executive officers may be deemed to
be participants in the solicitation of proxies from the
stockholders of Broadwing in connection with the proposed
transaction. Information about the directors and executive officers
of Level 3 is set forth in the proxy statement on Schedule 14A,
dated April 6, 2006, as supplemented, for Level�3�s 2006 annual
meeting of stockholders. Information about directors and executive
officers of Broadwing and their ownership of Broadwing common stock
is set forth in the proxy statement on Schedule 14A, filed with the
SEC on March 24, 2006, for Broadwing�s 2006 annual meeting of
stockholders. Additional information regarding participants in the
proxy solicitation may be obtained by reading the proxy
statement/prospectus regarding the proposed transaction when it
becomes available. Broadwing Corp. (NASDAQ:BWNG) today announced
that it has signed a definitive agreement to be acquired by Level 3
Communications, Inc. (NASDAQ:LVLT). Under the terms of the
agreement, Level 3 will pay $8.18 in cash plus 1.3411 shares of
Level 3 common stock for each share of Broadwing common stock
outstanding at closing. Based on yesterday's $5.32 closing price of
Level 3's common stock, each share of Broadwing stock would receive
consideration equivalent to $15.31 per share. The actual value of
the consideration received by Broadwing stockholders at closing
will depend on Level 3's share price at such time. "Bringing
together the resources and talents of Broadwing and Level 3 is an
exciting opportunity for our company, allowing us to capitalize on
the strengths of both companies and on advances in technology,"
said Steve Courter, CEO of Broadwing Corporation. "The combination
of our two operations will create a powerful company in the global
telecommunications industry with strong growth potential." Closing
is subject to customary conditions, including receipt of applicable
state and federal regulatory approvals, and is also subject to the
approval of the stockholders of Broadwing. Closing is expected to
occur in the first quarter of 2007. Broadwing was advised on the
transaction by Thomas Weisel Partners LLC. Goldman, Sachs & Co.
provided a fairness opinion to Broadwing. Broadwing received legal
representation from Greenberg Traurig, LLP. About Broadwing
Corporation Broadwing Corporation, through its consolidated
subsidiary Broadwing Communications, LLC, delivers innovative data,
voice, and media solutions to enterprises and service providers.
Enabled by its one-of-a-kind, all-optical network and award-winning
products and services, Broadwing Communications provides
communications solutions with unparalleled customer focus and
speed. For more information, visit www.broadwing.com. Broadwing and
its logo are trademarks and/or service marks of Broadwing
Communications, LLC, and/or Broadwing Corporation. All trademarks
and service marks not belonging to Broadwing are the property of
their respective owners. This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, but are not limited to, (i) statements about
the benefits of the acquisition of Broadwing by Level 3, including
financial and operating results, synergy benefits that may be
realized from the acquisition; Level 3's and Broadwing's plans,
objectives, expectations and intentions and other statements
contained in this press release that are not historical facts; and
(ii) other statements identified by words such as "expects,"
"anticipates," "intends," "plans," "believes," "seeks," "estimates"
or words of similar meaning. These forward-looking statements are
based upon management's current beliefs or expectations and are
inherently subject to significant business, economic and
competitive uncertainties and contingencies and third-party
approvals, many of which are beyond our control. The following
factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements:
(1) whether the stockholders of Broadwing approve the proposed
transaction; (2) the satisfaction of the other conditions specified
in the merger agreement, including without limitation the receipt
of required governmental approvals of the proposed transaction; (3)
the ability to successfully combine the businesses of Level 3 and
Broadwing; (4) the realization of revenue and cost synergy benefits
from the proposed transaction; and (5) operating costs, customer
loss and business disruption following the merger, including
adverse effects on relationships with employees. Other important
factors that may affect Level 3's and the combined business'
results of operations and financial condition include, but are not
limited to: increasing the volume of traffic on Level 3's network;
developing new products and services that meet customer demands and
generate acceptable margins; successfully completing commercial
testing of new technology and information systems to support new
products and services, including voice transmission services;
stabilizing or reducing the rate of price compression on certain of
our communications services; integrating strategic acquisitions
including the acquisition of Broadwing; attracting and retaining
qualified management and other personnel; and the ability to meet
all of the terms and conditions of our debt obligations. Level 3's
Annual Report on Form 10-K, subsequent Quarterly Reports on Form
10-Q, recent Current Reports on Form 8-K and other Securities and
Exchange Commission filings discuss the foregoing risks as well as
other important risk factors that could contribute to such
differences or otherwise affect our business, results of operations
and financial condition. The forward-looking statements in this
release and the related conference call for analysts and investors
speak only as of the date they are made. Level 3 and Broadwing do
not undertake any obligation to update any forward-looking
statement to reflect circumstances or events that occur after the
date such forward-looking statement is made. This press release
shall not constitute an offer of any securities for sale. The
proposed transaction will be submitted to Broadwing's stockholders
for their consideration. Level 3 and Broadwing will file a
registration statement, a proxy statement/prospectus and other
relevant documents concerning the proposed transaction with the
SEC. Stockholders of Broadwing are urged to read the registration
statement and the proxy statement/prospectus and any other relevant
documents filed with the SEC when they become available, as well as
any amendments or supplements to those documents, because they will
contain important information. Stockholders of Level 3 can obtain
more information about the proposed transaction by reviewing the
Form 8-K to be filed by Level 3 in connection with the announcement
of the transaction, and any other relevant documents filed with the
SEC when they become available. You will be able to obtain a free
copy of the proxy statement/prospectus, as well as other filings
containing information about Level 3 and Broadwing, at the SEC's
Web site (http://www.sec.gov). Copies of the proxy
statement/prospectus and the SEC filings that will be incorporated
by reference in the proxy statement/prospectus can be obtained,
without charge, by directing a request to Level 3, Investor
Relations, 1025 Eldorado Blvd., Broomfield, CO 80021, 720-888-2500
or to Broadwing, Investor Relations, 1122 Capital of Texas Highway
South Austin, TX 78746-6426, (866) 426-7847. Level 3, Broadwing and
their respective directors and executive officers may be deemed to
be participants in the solicitation of proxies from the
stockholders of Broadwing in connection with the proposed
transaction. Information about the directors and executive officers
of Level 3 is set forth in the proxy statement on Schedule 14A,
dated April 6, 2006, as supplemented, for Level 3's 2006 annual
meeting of stockholders. Information about directors and executive
officers of Broadwing and their ownership of Broadwing common stock
is set forth in the proxy statement on Schedule 14A, filed with the
SEC on March 24, 2006, for Broadwing's 2006 annual meeting of
stockholders. Additional information regarding participants in the
proxy solicitation may be obtained by reading the proxy
statement/prospectus regarding the proposed transaction when it
becomes available.
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