Level 3 to Acquire Florida's Progress Telecom for $137 Million

Level 3 Communications agreed to acquire Progress Telecom, a regional wholesale network services company based in St. Petersburg, Florida, for $137 million, consisting of $68.5 million in unregistered shares of Level 3 Common Stock and $68.5 million in cash.



The Progress Telecom network features diversely routed fiber, DWDM and SONET connecting nearly 200 POPs across the south-eastern U.S. The infrastructure includes over 8,524 route-miles of fiber and 29 metro networks. Progress Telecom currently generates annualized revenue of approximately $70 million and approximately $7 million of annualized positive free cash flow.



Progress Telecom is jointly owned by Progress Energy and Odyssey Telecorp.



"This transaction represents a unique opportunity to expand Level 3's footprint in the southeastern region of the United States, where we have seen strong demand for our services," said Kevin O'Hara, president and chief operating officer of Level 3. "More importantly, we serve a number of the same large, key customers, particularly certain wireless and international customers. We believe that the completion of this transaction will enable us to expand our relationship with these customers and offer them a broader set of services in more markets outside the southeast. Progress Telecom is a very successful wholesale carrier in the southeastern United States and this acquisition will increase the extent of our network coverage in the region."http://www.level3.comhttp://www.progresstelecom.com