19 August 2003 Broomfield, CO Lightwave--Level 3 Communications announced today that it has signed a definitive agreement to sell the Midwest Fiber-optic Network (MFON), a regional communications system it acquired through its recent transaction with Genuity. CenturyTel will purchase the stand-alone system, which serves as a regional backbone for a number of carriers, including CenturyTel itself, in Arkansas, Missouri, and Illinois. The purchase price is approximately $17 million in cash, subject to adjustments including date of closure and system revenue at time of close. Closing is subject to regulatory approvals and customary conditions.
"This is a non-core asset for Level 3," said Sunit Patel, Level 3's chief financial officer. "While MFON currently generates approximately $1.5 million a month in revenue, the geography and architecture of the system do not offer us a practical or cost-effective way to integrate its operations into the Level 3 network. As such, we believe it makes sense to sell this business and continue to focus on the integration of the core assets, customers and traffic from the Genuity transaction."
Closing is expectedIto occur by the endIof the fourth quarter of 2003. Daniels & Associates, the Denver-based media and telecommunications mergers and acquisitions specialist, served as financial advisor to Level 3 on this transaction.