Level 3 to Acquire Telcove for $1.2Billion, Gaining Local Access

Level 3 Communications agree to acquire TelCove, Inc., a privately held, facilities-based network operator, for $1.2375 billion in stock and cash.



TelCove's network has over 22,000 local and long haul route miles serving 70 markets across the eastern United States, with approximately 4,000 buildings on net. The company has annual revenues of about $390 million. TelCove also holds over 300 LMDS and 39 GHz licenses covering 90% of the U.S. population.



"The acquisition of TelCove increases our ability to provide end-to-end bandwidth services to our customers," said James Q. Crowe, chief executive officer of Level 3.



After integration, TelCove's metro and regional networks will connect Level 3's national backbone network directly to traffic aggregation points. These aggregation points include other carriers' points of presence, local telecommunications companies' central offices, wireless providers' switch centers, colocation and data centers, cable company head ends, and high-bandwidth enterprise locations.



Before the pending acquisitions of TelCove and ICG Communications and the completed acquisition of Progress Telecom, Level 3 already had extensive metro infrastructure in 36 markets, connecting to approximately 900 traffic aggregation points.



The acquisition of Progress and, after close, of TelCove and ICG Communications will increase Level 3's number of traffic aggregation points to approximately 5,000 in the U.S. and approximately 5,200 globally.

http://www.level3.comhttp://www.telcove.com