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CenturyLink, Qwest reach deal for merger approval

Mon, 01/03/2011 - 7:05am
The Associated Press

MONROE, La. (AP) – CenturyLink and Qwest Communications International have reached an agreement that could pave the way for Washington State regulators to approve the merger of the two companies in exchange for their commitment to invest at least $80 million in high-speed Internet networks across the state over five years.

CenturyLink and Qwest said Wednesday that they have reached an agreement with the staff of the Washington Utilities and Transportation Commission and the Public Counsel Section of the Washington State Attorney General's Office to recommend that the full state utilities commission approve the transaction, subject to conditions including broadband investment commitments and some rate freezes.

The deal must still be approved by the full Washington Utilities and Transportation Commission, which will hold hearings in early January.

Monroe, La.-based CenturyLink, the fifth-largest phone company, agreed in April to acquire Denver-based Qwest, the third-largest phone company, in a stock deal worth more than $10 billion. The transaction must be approved by regulators in more than 20 states, as well as federal regulators.

The company needs approvals from 21 states, the District of Columbia, and the FCC. It has now secured approval from 15 states.

Qwest shares fell 5 cents in after-hours trading, having closed up 2 cents to $7.62 in the regular session. CenturyLink shares closed 16 cents higher to $46.25 and were unchanged after hours.

Separately, Qwest said it has redeemed all of its outstanding 3.5 percent convertible notes due 2025, part of its plan to reduce its debt by $3.5 billion by the end of the first quarter of 2011. Approximately $1.1 billion of the notes were redeemed for about $1.7 billion. With this purchase of notes, Qwest said it has now reduced its debt by about $3.3 billion.

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