Qwest expects to close the nearly all-cash deal sometime next year, pending a bankruptcy court judge's approval, the carrier said Thursday. Dallas-based Allegiance filed for Chapter 11 bankruptcy protection in May.
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The agreement covers Allegiance's business-class telephone customers in 36 metropolitan areas, 31 of which are outside Qwest's present reach. Allegiance's voice and data traffic is valued at $500 million.
Qwest Chairman Richard Notebaert said the deal gives his company more "points of presence"--a way of measuring a telephone company's network reach--than most of its competitors. He added that the agreement will allow Qwest to expandinto selling VoIP dialing.
Allegiance Chairman Royce Holland characterized the pairing of long-distance and local phone companies as the first-ever "large-scale, out-of-region competitor for local service between the regional Bell companies."