CenturyLink ‘will cut capex’ after Level 3 takeover, says CFO
09 March 2017 | Alan Burkitt-Gray
CenturyLink is to likely to reduce its capital expenditure significantly thanks to synergies with Level 3, which the company is buying for $34 billion.
CenturyLink has already predicted its 2017 capex will be $2.6 billion, and Level 3 spent $1.3 billion in 2016, implying a total of nearly $4 billion. But CenturyLink CFO Stewart Ewing is expecting to cut 10% off that, he told a Deutsche Bank conference this week.
The $2.6 billion figure was already down on the previous rate of $3 billion a year. Ewing said that synergies with Level 3’s existing network will allow the company to cut capex further.
Some projects will be deferred or delayed, he told the bank’s media and telecom conference, so that CenturyLink can take advantage of Level 3’s infrastructure once the company is acquired.
He pointed out that Level 3 still had many unused conduits across the US from when it built out its network in the early years of the century.