Oct. 29, 2014, 5:30 PM
- Level 3 (NYSE:LVLT) will take Jabil's (NYSE:JBL) place in the S&P 500 following the Nov. 4 close.
- The announcement comes a day after Level 3 and TW Telecom (NASDAQ:TWTC) shareholders each approved the companies' cash/stock merger. The merger is expected to close before Level 3's Nov. 5 Q3 report.
- Jabil will take TW's place in the S&P MidCap 400.
- LVLT +3.1% AH. JBL hasn't moved yet.
Aug. 27, 2014, 11:33 AM
- Macquarie's Kevin Smithen has upgraded Level 3 (LVLT +3.5%) to Outperform, and set a $51 target. Merger partner TW Telecom (TWTC +2.7%) is following Level 3 higher.
- After talking with management, Smithen thinks Level 3 "has set conservative cost-savings targets" for the merger - the company previously forecast $240M/year in savings. He also considers TW easier to integrate than past acquisitions such as Global Crossing, given its lack of international assets and the fact the company isn't a roll-up of various properties.
- He admits there's still "a decent risk" of an integration misstep, but also believes "the risk of not owning [Level 3] if the company executes well is too great."
Jul. 29, 2014, 10:14 AM
- Windstream's (WIN +22.3%) plans to spin off some of its telecom network assets into a REIT (following a favorable IRS ruling) has lit a fire under U.S. telecom carriers, as investors bet more REIT announcements will happen. Some might also be hoping REIT spinoffs spark additional M&A activity in an industry that has seen plenty of it.
- Frontier (FTR +15.8%) and CenturyLink (CTL +8.1%) are also off to the races, and AT&T (T +3.9%), Verizon (VZ +1.9%), and Sprint (S +2%) aren't doing badly either.
- Other gainers include Alaska Communications (ALSK +5.2%), TDS (TDS +4.1%), and Lumos Networks (LMOS +5.5%), as well as Level 3 (LVLT +5.9%) and merger partner TW Telecom (TWTC +5.2%). Level 3 posted a Q2 beat this morning.
- Windstream's spinoff will feature its fiber/copper networks and other real estate. The company expects to retire $3.2B in debt following the spinoff (expected to close in Q1 2015), and to have the REIT raise $3.5B in debt.
- Windstream plans to have an aggregate annual dividend of $0.70/share following the spinoff ($0.60 for the REIT, $0.10 for Windstream proper). That's down from a current $1.00/share.
Jun. 16, 2014, 7:08 PM
- "TWTC has a very dense fiber metro base, and I think combined with LVLT domestic and international long-haul routes, the company will be able to deliver a new level of fiber connectivity around the world," says Stephens' Barry McCarver, offering an upbeat view of the Level 3 (LVLT -4.1%)/TW Telecom (TWTC +7.3%) deal.
- But others on the Street weren't as thrilled about the price, which at announcement time represented a 26% premium to where TW closed on Thursday, before a BrightWire report about Level 3's interest arrived.
- Light Reading's Carol Wilson notes the deal significantly boosts Level 3's enterprise/Ethernet reach, and that TW has a stellar reputation. "Twice in the past year I've had executives from tw telecom competitors volunteer the fact that they purposely avoid going head-to-head with that particular service provider."
- Level 3 is offering $10 in cash and 0.7 shares for each TW share. The company has already lined up $3B in financing; it had $7.8B in net debt at the end of Q1.
- Level 3 expects $240M/year in cost synergies ($200M adjusted EBITDA, $40M capex), and sees $170M in integration costs. TW shareholders will own 29% of the merged company. TW CEO Larissa Herda will be stepping down once the deal closes in Q4.
Jun. 16, 2014, 9:15 AM
Jun. 13, 2014, 12:46 PM
May 29, 2013, 1:28 PMU.S. telcos are having a rough day. A general selloff in high-yield stocks could be a factor, but not all of the decliners pay huge dividends (if any). VZ -2.9%. WIN -2.7%. CTL -2.4%. CBB -2.5%. CBEY -4.7%. TWTC -2.1%. TDS -2.6%. SHEN -7.4%. Volatile Latin American carrier NII Holdings (NIHD -7.2%) is also selling off. | May 29, 2013, 1:28 PM | 5 Comments
May 8, 2013, 1:20 PM
TW Telecom (TWTC +4.5%) jumps as Corvex's Keith Meister (an Icahn protege) tells Ira Sohn he'll be issuing a 13D today disclosing more than a 6% stake in the company. He sees the firm as an acquisition target, possibly by Level 3 (LVLT +5.6%) which is also rising as Meister ticks off the positive developments with respect to its balance sheet.| May 8, 2013, 1:20 PM
Feb. 11, 2013, 4:58 PMTW Telecom (TWTC): Q4 EPS of $0.11 misses by $0.04. Revenue of $377.9M (+7.5% Y/Y) beats by $2.1M. Shares -2.7% AH. (PR) | Feb. 11, 2013, 4:58 PM