*Pages 1--5 from Microsoft Word - 60447.doc* PUBLIC NOTICE Federal Communications Commission 445 12 th Street, S. W. Washington, D. C. 20554 News Media Information 202 / 418- 0500 Fax- On- Demand 202 / 418- 2830 TTY 202 / 418- 2555 Internet: http:// www. fcc. gov ftp. fcc. gov DA 06- 2097 Released: October 23, 2006 DOMESTIC SECTION 214 APPLICATION FILED FOR THE TRANSFER OF CONTROL OF BROADWING CORPORATION TO LEVEL 3 COMMUNICATIONS, LLC. STREAMLINED PLEADING CYCLE ESTABLISHED WC Docket No. 06- 193 Comments Due: November 6, 2006 Reply Comments Due: November 13, 2006 On October 17, 2006, Broadwing Corporation (“ Broadwing Parent”) and Level 3 Communications, LLC (“ Level 3 LLC” or “Transferee”) (together, “Applicants”) filed an application (“ Application”) pursuant to section 63.04 of the Commission’s rules 1 requesting authority to transfer control of Broadwing Parent to Level 3 LLC. 2 Applicants assert that this transaction is entitled to presumptive streamlined treatment pursuant to section 63.03( b)( 2)( i) of the Commission’s rules because, immediately following the transaction: (1) Transferee will hold less than a ten percent (10%) share of the interstate, interexchange market; (2) Transferee will provide competitive telephone exchange services or exchange access services only in geographic areas served by dominant local exchange carriers (none of which are parties to the proposed transaction); and (3) neither of the Applicants nor their affiliates are dominant with respect to any service. 3 Broadwing Parent, a Delaware corporation, is a holding company with two wholly-owned, principal operating subsidiaries: (1) Broadwing Communications, LLC (“ Broadwing”), a Delaware limited liability company providing data, video, and voice (local, intrastate, 1 47 C. F. R § 63.04; see 47 U. S. C. § 214. 2 Applicants filed a supplement to the application on October 19, 2006. Applicants have also filed an application for transfer of control associated with authorization for international services. Any action on this domestic 214 application is without prejudice to Commission action on other related, pending applications. 3 47 C. F. R. § 63.03( b)( 2)( i). 1 2 interstate) services in all 50 states and the District of Columbia to businesses, carriers, and some residential customers, and (2) Corvis Equipment, LLC, a developer of network equipment. Applicants state that Broadwing Parent owns 100 percent of Broadwing Communications Holdings, Inc., a Delaware corporation, that in turn owns 100 percent of C III Communications, LLC, a Delaware limited liability company. Both of these latter entities operate as holding companies and are not involved in telecommunications operations. Level 3 LLC, a Delaware limited liability company, provides domestic telecommunications and information services on a nationwide basis. It is an indirect, wholly-owned subsidiary of Level 3 Communications, Inc. (Level 3 Parent), a Delaware corporation that offers, through its operating subsidiaries, communications services on a nationwide basis, including Internet- protocol- based services, broadband transport, collocation services, and voice services. Level 3 LLC is a wholly- owned subsidiary of Level 3 Financing, Inc. (“ Level 3 Financing”), and Level 3 Financing, LLC, in turn, is a wholly- owned subsidiary of Level 3 Parent. Level 3 Services, LLC, a Delaware limited liability company established for the purpose of merging with Broadwing Parent, offers no services and is a direct, wholly- owned subsidiary of Level 3 Parent. Level 3 Parent is a publicly- traded Delaware company. Applicants state that one entity owns or controls 10 percent or more of Level 3 Parent: Southeastern Asset Management, Inc. (“ SAM”), a Tennessee investment corporation that is employee- owned and that holds sole or shared voting rights for 13.09 percent of the outstanding shares of Level 3 Parent that are otherwise owned by other entities for whom SAM acts as an investment advisor. Applicants state that none of SAM’s owners holds a 10 percent or greater direct or indirect interest in Level 3 Parent. Pursuant to an October 16, 2006 Agreement and Plan of Merger (“ Agreement”), Level 3 Parent will acquire all of Broadwing Parent’s outstanding shares by paying total consideration of approximately $1.4 billion. Level 3 Parent will acquire Broadwing Parent in a simultaneous three- step transaction. First, Broadwing Parent will merge with Level 3 Services, LLC, with Level 3 Services, LLC surviving. Second, Level 3 Parent will immediately contribute all of its membership interest in Level 3 Services, LLC to Level 3 Financing, Inc. Third, Level 3 Financing, Inc. will contribute all of the membership interest in Level 3 Services, LLC to Level 3 LLC, at which time Level 3 Services, LLC may be re- named. Following the completion of these three steps, Level 3 Services, LLC will then be a direct subsidiary of Level 3 LLC, and Broadwing will be an indirect, wholly- owned subsidiary of Level 3 LLC. Applicants further state that no existing stockholder or controlling group of stockholders of Broadwing Parent will have a 10 percent or greater direct or indirect interest in Level 3 Parent or Level 3 LLC as a result of the proposed transaction. Applicants state that the proposed transaction will serve the public interest, convenience and necessity because: (1) Broadwing will continue to operate its facilities and provide service to existing customers at the same rates, terms, and conditions, ensuring a seamless transition for 2 5 (3) Jodie May, Competition Policy Division, Wireline Competition Bureau, 445 12th Street, S. W., Room 5- C234, Washington, D. C. 20554; e- mail: jodie. may@ fcc. gov (4) Susan O’Connell, Policy Division, International Bureau, 445 12th Street, S. W., Room 7- B544, Washington, D. C. 20554; email: susan. o’connell@ fcc. gov; and (5) James Bird, Office of General Counsel, 445 12th Street, S. W., Room 8- C824, Washington, D. C. 20554; e- mail: james. bird@ fcc. gov. Filings and comments are also available for public inspection and copying during regular business hours at the FCC Reference Information Center, Portals II, 445 12th Street, S. W., Room CY- A257, Washington, D. C. 20554. They may also be purchased from the Commission’s duplicating contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street, S. W., Room CY-B402, Washington, D. C. 20554, telephone: (202) 488- 5300, fax: (202) 488- 5563, or via e- mail www. bcpiweb. com. People with Disabilities: To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an e- mail to fcc504@ fcc. gov or call the Consumer & Governmental Affairs Bureau at 202- 418- 0530 (voice), 202- 418- 0432 (tty). For further information, please contact Cecilia Seppings at (202) 418- 1588, or Jodie May at (202) 418- 0913. - FCC - 5