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More than a decade after the dot-com bust, two fallen Internet stars hope to regain some of their glory with a $3 billion deal that could prompt similar transactions.

On Monday, Level 3 Communications announced that it would buy the Internet service provider Global Crossing for $23.04 a share — a 56 percent premium to the stock’s closing price Friday, before the acquisition was announced. As part of the deal, Level 3 will also assume $1.1 billion of debt.

With the acquisition, Level 3 will expand its network in fast-growing markets like Latin America and potentially improve its balance sheet by cutting overall costs. It is also an important test for the industry, which has been plagued for years by overcapacity and weak pricing.

“This is the start of consolidation,” said Donna Jaegers, an analyst with the research company D.A. Davidson. “It’s not enough to firm up pricing overnight, but it’s a step in the right direction.”

Level 3 and Global Crossing, once high-flying network operators, have floundered since 2000. Global Crossing filed for bankruptcy in 2002, then re-emerged two years later with a new backer — Singapore Technologies Telemedia, which now owns about 60 percent of the company. While Level 3 avoided a similar fate with a cash infusion from Warren E. Buffett’s holding company Berkshire Hathaway, it has also struggled to increase revenue and maintain profitability.

Last year, losses at Level 3 hit $622 million and at Global Crossing $176 million. As profits have eroded, Level 3’s financial situation has become more precarious; its debt was $6 billion in December.

From a network standpoint, the combined company, which would own thousands of miles of fiber optic cables across 70 countries, would be a telecommunications giant. Level 3 is strong in North America and Europe, while Global Crossing has a robust presence in Latin America. Global Crossing’s enterprise contacts will help Level 3 increase its client base, which includes major telecommunications, cable, and Internet businesses.

“This will be a company with modern Internet infrastructure, across three different continents, connected by undersea cables that we control,” James Q. Crowe, chief executive of Level 3, said in a telephone interview Monday.

Perhaps more important, the deal would give Level 3 a chance to improve its financial picture.

Crowe said the potential cost savings could total $2.5 billion, with $200 million in the first 18 months.

With stronger cash flow, analysts figure Level 3 could refinance its debt to cut its interest rates between $100 million and $200 million a year.