Level 3, a big internet service provider, has announced that it’s acquiring Global Crossing, a provider of networking services, for $3 billion in stock.
Level 3 has a big internet access network, and while Global Crossing also has its own network it focuses mostly on higher value-added services like transmitting audio and video more efficiently. The combined company will have fibre optic networks in Europe, the US and Asia and presumably will have bigger scale to offer better, cheaper services to clients like Netflix who rely on their fast lines to carry data really fast.
“This transaction will create a company with … combined 2010 revenues of $6.26 billion and … combined 2010 … EBITDA of $1.27 billion before synergies and $1.57 billion after expected synergies,” the release says.
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