EarthLink to buy ITC Deltacom for $191 mn

BANGALORE, INDIA: Internet services provider EarthLink Inc said it would buy fiber optics networks company ITC Deltacom for about $191 million in cash to expand its footprint in southeastern United States.

The Atlanta, Georgia-based company said it would also assume $325 million of Deltacom's debt.

Deltacom currently serves over 32,000 small- and mid-size businesses, government agencies and wholesale customers and owns 16,400 miles of fiber-optic network, EarthLink said in a statement.

EarthLink, which raised its 2010 net income outlook to $94-$97 million from $84-$92 million, expects the deal to close in the fourth quarter of 2010 or the first quarter of 2011.

Shares of EarthLink closed at $9.09 Thursday on Nasdaq. They have fallen 3 percent since their 2010 high of $9.35 in April, when the company reported first-quarter results.