CenturyLink expects the move to increase its revenue, EBITDA and free cash flow in the year after closing.
CenturyLink will combine its hosting and network assets with Savvis’ solutions portfolio. Former Savvis CEO Jim Ousley will lead the unit, which will be headquartered in St. Louis, Mo.
The companies have a combined 48 data centers in North America, Europe and Asia.
Savvis stockholders will receive $30 per share in cash and 0.2479 of a share of CenturyLink common stock for each Savvis share held at the close of the transaction.
CenturyLink has also prepaid approximately $546 million of Savvis’ credit facility debt.
With its acquisitions of Qwest and Savvis, CenturyLink is the third largest telecom operator in the U.S.