Qwest, the local phone provider in 14 U.S. states, said its stock price may be standing in the way of an acquisition as mergers sweep the industry.
“Our stock has not been trading at a high-enough level to really have it be a real currency to go out and do something ourselves,” chief financial officer Joe Euteneuer said in an interview Thursday in New York. “That would be our biggest stumbling block. It’s not from a lack of willingness or desire, but really a lack of currency.”
The stock price is one element hindering an acquisition of Level 3 Communications Inc., a Broomfield-based speculated target, said Chris Larsen, a Piper Jaffray Cos. analyst in New York. Qwest’s competitors have pursued more takeovers as companies add scale to make up for phone-line losses. Level 3’s business would help Qwest grow while cutting plants and employees, Larsen said.
Euteneuer said phone companies in the U.S. are ripe for more combinations.
“Consolidation is something that, in my opinion, I think is going to happen,” Euteneuer said. “Enough people have talked about it, enough people want it to happen and can see the benefits of it.”
Qwest lost 48 percent of its value last year. Revenue declined as home-phone customers canceled service, opting for mobile or Internet- based products.
Level 3’s debt load is also a deterrent to potential acquirers, Euteneuer said.
He declined to comment on whether the two companies are in discussions about a deal. Level 3 spokesman Skip Thurman declined to comment.
Qwest to shutter Pueblo center
PUEBLO — Qwest says it plans to close its call center in Pueblo in March.
Qwest spokeswoman Monica Martinez said Thursday that the call center has about 75 jobs.
She said there are limited opportunities for affected workers to transfer to Iowa or Utah. Workers losing their jobs will receive support packages.
Denver-based Qwest is the primary local phone service provider in 14 mostly Western states.
The Associated Press
