CenturyLink to Buy Level 3 for $34B
The acquisition values Level 3 at $66.50 a share, the companies said in a statement Monday. That’s about 42 percent above where the Broomfield, Colorado-based company was trading last week, before reports surfaced of a potential acquisition by CenturyLink...What explains this? I could understand a small jump in value, but what can be the basis for a $14B gain in a company's value when the only facts that have changed are that a buyer exists? Does the market "believe" that the company's future 42% brighter under the prospect of a buyout, and that belief is captured in the price now?