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Energy Transfer Equity Gains Williams Companies, Inc.

by Elizabeth Alford on September 30, 2015

Energy Transfer Equity announced this week that it will acquire The Williams Companies, Inc. (WMB) for approximately $32.61 billion.

Related: Oil & Gas Companies Enter Survival Mode

Williams formerly rejected a $48 billion offer from Energy Transfer in June. But prolonged natural gas prices had dimmed the outlook for growth. This announcement is on the same day that another merger was cancelled and cost The Williams Companies, Inc. $428 million.

WeissLaw LLP, a class action firm, is investigating the fairness of the acquisition by focusing on possible breaches of fiduciary duty and other violations of law by the Board of Directors of WMB for agreeing to sell the Company to Energy Transfer.

WeissLaw is investigating whether WMB’s Board acted to maximize shareholder value prior to entering into the agreement. Notably, the offer price represents a mere 4.5% premium over the Company’s September 25, 2015 closing price of $41.60. Additionally, several analysts set a target price of $63.00 per share, or $19.50 above the offer price. Further, the WMB shares traded at $58.77 as recently as July 14.

The deal is valued at $37.7 billion, including debt and other liabilities, and is expected to close in early 2016. The combined network of the two firms include more than 100,000 miles of oil and gas pipelines that traverse the continent.

Sanchez confirmed this week that they will sell approximately 150 miles of midstream gathering lines and associated midstream infrastructure in the Eagle Ford in order to gain much-needed cash. Sanchez Production Partners will acquire and operate the assets concentrated in four gathering and processing facilities. Both firms are run by the private Sanchez Oil & Gas Corp.

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