Updated from 3:11 p.m. EDT

Time Warner Telecom ( TWTC), a communications service provider owned in part by Time Warner ( TWX), on Friday announced plans to purchase most of the assets of GST Telecommunications for $690 million in cash.

Time Warner Telecom, based in Littleton, Colo., said it has agreed to buy almost all of the debt-laden company's assets, excluding most of GST's Hawaiian assets and some residual cash balances. GST Telecommunications, a telecom carrier based in Vancouver, Wash., filed for bankruptcy protection on May 17. Its assets were auctioned off in open bidding this week.

Pending regulatory approval, Time Warner Telecom said it expected the transaction to be completed by the end of the year.

GST has a strong national Internet network, and provides local and long-distance phone service, Internet access, and data services to about 100,000 businesses in the western part of the country, according to Hoover's Online. Acquiring those assets should help Time Warner Telecom build out its own fiber-optic networks.

The company is busy building local and regional fiber optic networks in major markets across the nation through which it is capable of delivering a wide range of communications services. It now provides broadband data, voice and Internet connections in 22 major U.S. cities, with plans to offer similar services in seven more markets over the next year, according to company officials.

"Acquiring these assets gives them the time-to-market advantage," said Jonathan Atkin, analyst at Dain Rauscher Wessels. "They're able to come in to these new markets and offer more customized services." Dain Rauscher Wessels does not underwrite the stock.

Investors showed little reaction to news of the deal, however. Shares of Time Warner Telecom closed down 5/8, or 1%, at 61 7/16.

"People are waiting to assess the financial impact, how soon it has an impact on the income statement," said Atkin, who rates the stock a strong buy with a long-term target price of $91.