Time Warner Telecom ( TWTC) agreed to acquire Xspedius Communications for $531.5 million. Littleton, Colo., Time Warner Telecom will fork over $212.5 million in cash and issue $319 million worth of Class A Common Stock. The company will assume no debt in the acquisition. Xspedius is a metro fiber-based provider of integrated communications services primarily to enterprise businesses as well as carrier customers. It sells metro Ethernet, local and long distance voice, data and dedicated Internet access services, in 43 markets across 18 states and the District of Columbia. "This acquisition significantly broadens the already extensive nature of our local assets and national capabilities," said Larissa Herda, Chairman, CEO and President of Time Warner Telecom. "This strategic acquisition further expands our network reach and market density for serving multilocation and multicity enterprise customers, increasing the number of markets we serve from 44 to 75, and enhances our ability to further fuel our enterprise growth." Time Warner Telecom expects so-called annualized cost synergies of approximately $40 million to $50 million within 12 to 18 months of closing, and expects $40 to $50 million in one-time investments to integrate the business. The stock consideration is subject to a 20% symmetrical collar adjustment. This adjustment is based on the average share price of Time Warner Telecom's Class A common shares for the 20 trading days prior to closing as compared to $14.57. The consideration will be adjusted for a stock price decrease in the form of additional cash and stock, or for a stock price increase by decreasing the stock consideration. Closing is expected within six months, and is subject to customary conditions, including the receipt of applicable federal and state regulatory approvals. The transaction has been approved by the required majority consent of equity holders of Xspedius Communications and does not require a Time Warner Telecom shareholder vote.