Colorado based communications company, Level 3 Communications has raised $500 million in bonds from a group of corporate investors that includes the Berkshire Hathaway group chaired by billionaire Warren Buffett. Level 3’s shares rose 59.5% to $4.61 per share following the unveiling of the investment.
Level 3 plans to use the $500 million investment along with its $1.1 billion cash reserves to acquire a number of companies. The company believes that the current shakeout in the telecoms industry is creating many opportunities as companies, network assets and customer bases all become available for acquisition.
News of the investment comes when a number of Level 3’s rivals are in Chapter 11 bankruptcy protection. Level 3 currently has debts of approximately $6.4 billion but many analysts believe that the investment will make it much easier for Level 3 to survive the telco slump.
Level 3 has acquired two software resellers, Software Spectrum and Corporate Software, during this year. The company has also recently completed its 20,000-mile global fiber optic network used by regional carriers, ISP’s and Cable TV companies.