AT&T isn’t the only communications company eager to acquire. This morning CenturyLink, a broadband services company that also provides video to about 318,000 customers, agreed to pay cash and stock worth $34 billion (including debt) for Level 3 Communications, an important provider of internet backbone services.

“The digital economy relies on broadband connectivity, and together with Level 3 we will have one of the most robust fiber network and high-speed data services companies in the world,” CenturyLink CEO Glen Post says.

The fiber optic lines will “distinguish CenturyLink from our competitors,” he adds. Meanwhile, his shareholders will “benefit from the significant synergies and financial flexibility provided by the combined company’s revenue growth and strong cash flow.”

CenturyLink shares are down more than 10% in pre-market trading while Level 3 is up 7%.

When word of the companies’ talks leaked last week, Cowen & Co’s Colby Synesael said the development could put Level 3 in play — perhaps with Comcast entering the fray.

It’s “highly unlikely that a cable company would be interested in buying a combined Level 3/CenturyLink and thus could create a ‘now or never’ type situation,” the analyst says. “The timing admittedly is not ideal considering we’ve also stated that the recent AT&T/Time Warner merger announcement could push cable to feel compelled to buy T-Mobile and as such while Comcast may want to buy Level 3 they may need to buy T-Mobile. The list doesn’t include just Comcast though and could very well include Liberty Global as well as other domestic MSOs.”

CenturyLink is offering Level 3 holders the equivalent of $66.50 a share, a 42% premium over the trading price before word of the companies’ talks got out.. Each share will be bought for 26.50 in cash and 1.4286 of CenturyLink shares. When complete, Level 3 holders will own about 49% of the combined company.

The companies expect the deal to close by this time next year.

Post will be CEO of the combined company. Level 3’s CFO,  Sunit Patel, will keep that job. .

The acquisition would expand CenturyLink’s network to 64,000 route miles in 350 metropolitan areas including 33,000 subsea route miles connecting multiple continents. About 75% of the revenues would come from business customers.

Execs expect to save $975 million of annual savings and synergies.