Level 3 to bankroll Genuity

Summary:The US telco has put big bucks on the table to save beleaguered Genuity from bankruptcy

Level 3 is to buy Internet hosting and IP networking company Genuity for $242m (£156m) in cash.

Genuity will go into voluntary Chapter 11 bankruptcy protection ahead of completion of the deal in the first quarter of 2003.

Genuity's operations have been main hubs over the years for the development of the Internet and the company has gone through several owners and names -- from BBN, to GTE Internetworking, and then Genuity, after it was spun off because of regulatory concerns relating to the formation of Verizon Communications, merging Bell Atlantic and GTE.

Jim Crowe, Level 3 chief executive officer, talked about a "unique and compelling fit" between the two companies in a statement. A conference call on Monday, after US Thanksgiving holiday celebrations, should shed further light on the deal.

Although it has invested heavily in a global IP fibre network, Level 3 remains a cash-rich company. This year Berkshire Hathaway, the investment vehicle of billionaire Warren Buffet, traditionally known for avoiding technology stocks, placed its faith in the alternative telco by buying a $100m stake. Other funds took $400m of holdings.


For a round-up of the latest tech business coverage, see the Business News Section.

Have your say instantly, and see what others have said. Go to the ZDNet news forum.

Let the editors know what you think in the Mailroom.

Topics: Tech Industry

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Related Stories

The best of ZDNet, delivered

You have been successfully signed up. To sign up for more newsletters or to manage your account, visit the Newsletter Subscription Center.
Subscription failed.