LEVEL 3 (LVLT)

[Magnusson]

Level 3 Communications Inc. (LVLT) Trade Alert - LVLT Announces an Effort to Push Back a Major Debt Repayment until 2013

Level 3 Communications Inc. (LVLT) shares climbed 5.29% Monday to close at 92 cents. Level 3 engages in the communications business in North America and Europe. Level 3's network and Internet services include transport services, high speed Internet protocol services, dedicated Internet access, virtual private network services, colocation services and dark fiber services.

In an effort to alleviate concerns over the company’s liquidity, Level 3 announced it is offering to buy back $1.14 billion worth of debt the company has coming due in the next two years. Also, it announced it will fund part of the purchase with the issuance of $400 million in new debt due three years later.

Its offer to buy 2009 and 2010 debt notes expires December 15. If holders of those notes sell back all of them, it would cost Level 3 $838 million. The company is funding part of the buyback with $400 million in debt notes due in 2013 that investment groups have agreed to buy. The rest of the 2010 debt repurchase would come from Level 3’s $438 million cash on hand.

In a research note, Credit Suisse analyst Chris Larsen stated, "The debt repurchase should alleviate concerns related to liquidity and near-term debt maturities through 2010."

Level 3's stocks had fallen in the recent downturn over concern about the company’s liquidity with such large debt repayments looming in 2009 and 2010.

Level 3's content distribution products and services comprise content delivery network, media delivery services, fiber optic and satellite video transport services, and advertising distribution services.

Its switched services include VoIP Enhanced Local to launch IP-based local and long-distance voice services to residential and business customers; Local Inbound service that terminates traditional telephone network originated calls to Internet Protocol termination points; E-911 Direct comprising a fixed-location solution with network connections to public safety answering points and a solution for nomadic voice over IP providers; and One Plus, an automatic number identification based and carrier identification code based service, as well as a dedicated end-user service.

Its enterprise local and long distance voice services include PSTN connectivity for customer telephone equipment; telephone numbers that include associated directory listings; standard services that comprise operator services, directory assistance and 911 services; and long-distance access services.

The company's switched services also comprise enterprise toll-free services; voice termination services; toll free services; and managed modem, an outsourced, turnkey infrastructure solution.

As of December 31, 2007, Level 3 Communications had an intercity network covering 67,000 miles and local networks in 116 markets in North America; and an intercity network covering 10,000 miles and local networks in nine markets in Europe.

Further, it sells coal primarily through long-term contracts with public utilities.

In its recent chart, LVLT is trading within its Bollinger Bands, a normal condition signaling that the stock is neither overbought nor oversold relative to the recent price action. MACD reflects a weak bullish signal, with the indicator trending above the 9-day moving average signal line but still below the 0 level, indicating bearish moving averages. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.