Level 3 Communications Inc. on Thursday said it has acquired the wholesale Internet dial access business of ICG Communications Inc.
Level 3 said it would pay approximately $35 million to acquire a business providing dial-up Internet access to America Online, Earthlink, MSN, United Online and other ISPs. Broomfield, Colo.-based Level 3 said it expects the acquisition to add approximately $35 million in incremental revenue this year.
Level 3 said it anticipates migrating most of ICG’s customer traffic onto its own network over the next two quarters.
ICG said it would continue to offer so-called primary rate interface service to ISPs, other carriers and businesses, and retain its nationwide data backbone.
“We're pleased to have finalized the sale of our RAS customers to Level 3," says Rich Fish, executive vice president and CFO at ICG. "This transaction is in keeping with our previously stated objectives to address the company's liquidity situation through divestiture of non-core assets."
In a filing with the SEC in November 2003, ICG said it would need to improve its liquidity through various initiatives, including the sale of certain non-strategic assets. The Englewood, Colo.-based company also said it would need to raise additional financing “no later than the first quarter of 2004, unless sufficient asset sales occur first.”
