Pending Acquisition of tw telecom (Notes)

6 Months Ended

Jun. 30, 2014

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

Pending Acquisition of tw telecom

On June 15, 2014, the Company and two subsidiaries of Level 3 executed the Agreement and Plan of Merger (the “Merger Agreement”) with tw telecom inc. (“tw telecom”) pursuant to which the Company expects to acquire tw telecom in a tax-free, stock and cash transaction (the “Merger”) valued at approximately $7.6 billion, based on Level 3’s closing stock price on June 13, 2014, including the assumption of approximately $1.9 billion of debt as of March 31, 2014. tw telecom stockholders will receive $10 cash and 0.7 shares of Level 3 common stock for each share of tw telecom common stock that is owned at closing. See Note 12 — Subsequent Event for additional information.

In connection with this transaction, Level 3 also has signed a voting agreement and stockholder rights agreement with a subsidiary of Singapore Technologies Telemedia (“STT”), a stockholder of Level 3, whereby STT has agreed to vote in favor of the transaction.

The acquisition of tw telecom is subject to regulatory approvals and customary closing conditions. The Company continues to expect that the transaction will close before the end of 2014.

In addition, concurrently with the execution of the Merger Agreement, Level 3 Financing, Inc. and the Company entered into a financing commitment letter (the “Commitment Letter”) with the Commitment Parties, as separately defined in the Commitment Letter. The Commitment Letter provides for a senior secured term loan facility in an aggregate amount of up to $2.4 billion (the "senior secured facility"). The Commitment Letter also provides for a senior unsecured facility bridge financing of $600 million (the "unsecured facility"). The unsecured facility portion of the Commitment Letter is reduced by the amount of any senior notes or certain other securities ("debt securities") that are issued in relation to the Merger on or prior to the closing of the Merger. Under certain circumstances, the committed amounts can be allocated from the senior secured facility to the unsecured facility at the option of Level 3. Unless Level 3 or Level 3 Financing, Inc. has obtained an aggregate of $3.0 billion in the capital markets prior to closing, Level 3 and Level 3 Financing retain the ability to draw on the commitments contained in the Commitment Letter pursuant to the terms and conditions as specified in the Commitment Letter. The Company expects the financings, together with cash balances, to be sufficient to provide the financing necessary to consummate the tw telecom transaction and to refinance certain existing indebtedness of tw telecom.