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WIlliams Sues Over Merger To Protect Stockholders

The downtown skyline view from the \"party deck\" at the new Oneok Field.
KWGS News Photo
The downtown skyline view from the \"party deck\" at the new Oneok Field.

Tulsa based Williams Co. is going to court in Dallas and in the state of Delaware over a merger deal with ETE.  Williams  is suing Energy Transfer Equity and that company’s CEO in connection with the merger of the two companies.  The lawsuit claims ETE and CEO Kelcy Warren made private stock offerings in violation of the merger agreement announced last fall.

Last month, ETE announced, in Security and Exchange Commission filings, that it would close Williams operations in Tulsa and Oklahoma City. In Tulsa, that would mean the loss of 1,000 jobs.

The Williams Board issued the following statement:

The Williams Board is unanimously committed to enforcing its rights under the merger agreement entered into with ETE on September 28, 2015 and to delivering the benefits of the merger agreement to Williams’ stockholders. ETE has no basis to avoid its obligations under the merger agreement.

Williams has reviewed ETE’s private offering of convertible preferred units and concluded it is a breach of the merger agreement. Among other things, the offering provides select ETE investors with preferential treatment on ETE distributions.

Williams has commenced litigation to protect the interests of its stockholders. The litigation is intended to ensure that Williams’ stockholders will receive the consideration to which they are entitled under the merger agreement.

Williams is committed to mailing the proxy statement, holding the stockholder vote and closing the transaction as soon as possible.

Williams remains committed to working with ETE to ensure the financial strength of the combined company, provided that all ETE and Williams investors are treated fairly and equitably. Williams looks forward to completing the transaction and delivering its benefits to the Company’s stockholders.

The Williams Board has not changed its recommendation "FOR" the merger agreement executed on September 28, 2015. In addition to the receipt of Williams’ stockholder approval, the transaction remains subject to other customary closing conditions. Integration planning is underway. The transaction is expected to close in the second quarter of 2016.