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Technology Stocks : Genuity, Inc. (GENU) -- Ignore unavailable to you. Want to Upgrade?

To: Ms. Baby Boomer who wrote (452)	4/4/2003 9:58:46 PM
From: Ms. Baby Boomer	Respond to of 456

UPDATE - Level 3 to exit Web hosting business Friday April 4, 4:11 pm ET NEW YORK, April 4 (Reuters) - Level 3 Communications Inc. (NasdaqNM:LVLT - News) said on Friday it would exit its Internet hosting business and hand off the operations to Computer Sciences Corp. (NYSE:CSC - News), a computer services company. No money is exchanging hands, but under the terms of the deal, Computer Sciences will assume the lease of some Level 3 data centers, employ 125 of its staff and pay Level 3 for the network services needed to support the existing customers. The two companies said they expected the deal to close by the second quarter. Level 3, a high-speed communications company, acquired the business as part of its purchase of bankrupt Genuity Inc.'s assets earlier this year. But in a statement, Level 3 said the unit "lacked sufficient scale to achieve profitability in an appropriate time frame." The Internet hosting business -- which offers Internet access and Web site hosting services among other things -- was expected to generate revenues of about $40 million, and a loss, excluding interest, taxes, depreciation and amortization, of about $5 million for the full year 2003. Mike Dickerson, a spokesman for Computer Sciences, one of the world's biggest providers of computer consulting and services, said the deal was "a sound business decision" and expanded its existing Web hosting offerings. SMALLEST UNIT Genuity, another high-speed network provider, filed for bankruptcy last November, buckling under a glut of fiber optic network capacity, tumbling prices and stiff competition. The hosting business was its smallest unit, serving about 2 percent of the roughly 5,000 customer contracts it sold to Level 3. Genuity's main business, like Level 3, is selling network capacity to other telecoms carriers and Internet service providers, such as Verizon Communications. (NYSE:VZ - News) Level 3 closed the deal to buy all Genuity's assets in February as part of its aim to scoop up distressed telecommunications companies after the firm secured $500 million in funding last July. At the time, the company's Chief Executive James Crowe said Level 3 would use the money to buy rivals assets and take customers from troubled long-distance and local phone operators. Genuity, which it purchased for $242 million, is Level 3's biggest acquisition since then. Shares of Level 3 closed up 1 cent at $5.42 on Nasdaq. Computer Sciences ended off 77 cents, or more than 2.5 percent, at $29.43 on the New York Stock Exchange (News - Websites).... biz.yahoo.com