Level 3 Communications Investors Might Not Prosper After Synergistic Deal
After one of the best quarters in corporate history, the announced buyout of TW Telecom (NASDAQ: TWTC ) by Level 3 Communications (NYSE: LVLT ) is mildly surprising. Considering the deal is mostly in stock, it might also signal that Level 3 stock has appreciated too much, with the company choosing to use it as the major currency in this deal.
In general, the deal is portrayed as an ability to gain scale and reduce costs via synergies. Remember, the companies compete against the likes of AT&T (NYSE: T ) for access to the global data communications needs of enterprise customers.
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