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CenturyLink will offer $26.50 in cash and 1.4286 of its shares
for each Level 3 share held.
Level 3's shares were up 3.9 percent at $56.15 in light
premarket trading while CenturyLink's shares were unchanged.
The deal would combine Level 3's enterprise services with
CenturyLink's network that provides internet and telephone
offerings to millions of customers.
Including debt, the deal is valued at about $34 billion.
The deal, for about $66.50 per share, is at a premium of 42
percent from Level 3's Wednesday close. Reuters reported on
Thursday that the companies were in advanced talks to merge.
The deal comes at a time when business clients of both companies
seek more bandwidth and faster capabilities to move data to run
their businesses.
This deal, expected to close by the end of the third quarter of
2017, will increase CenturyLink's network by 200,000 miles of
fiber.
CenturyLink shareholders will own about 51 percent of the
combined company and the rest by Level 3 shareholders.
Up to Friday's close, CenturyLink's shares had fallen nearly 21
percent this year while those of Level 3 were marginally lower.
(Reporting by Narottam Medhora and Supantha Mukherjee in
Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta)
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