Williams' board 'committed' on completing Energy Transfer deal | Reuters

Williams board committed on completing Energy Transfer deal
| Reuters

Williams Cos Inc said it would go ahead with the $33 billion deal to be acquired by pipeline giant Energy Transfer Equity LP, allaying concerns that the transaction might fall apart due to the steep slide in oil prices.

Analysts have raised questions whether the deal would be renegotiated or cancelled following a 60 percent drop in stocks of both companies since Sept. 28, when Energy Transfer agreed to buy Williams for $43.50 per share.

Williams' shares closed at $16.10 on Friday, while Energy Transfer's closed at $8.78.

"In response to market speculation, The Williams Companies, Inc today announced that its board of directors is unanimously committed to completing the transaction with Energy Transfer Equity," the company said in a statement.

After the recent rout, ETE's cash-and-stock offer now puts Williams' equity at only about $17 billion.

Analysts have said Williams' high levels of debt also puts the deal at risk. Moody's Investors Service cut its credit rating on Williams to junk last week, saying it was concerned about the ability of customers like Chesapeake Energy to make good on their contractual obligations if low crude prices continue.

A fund manager invested in Williams told Bloomberg Business earlier this week that the slump in the value of both stocks had fuelled uncertainty over closing of the deal.

(Reporting by Anet Josline Pinto in Bengaluru)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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Updated Date: Jan 16, 2016 05:30:12 IST

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