Natural gas pipeline titan Williams Companies Inc. (NYSE: WMB) has rejected a buyout offer from Energy Transfer Equity (NYSE: ETE) worth $48 million, but announces that they have not closed down sales.
Williams Company maintains the production and exporting of natural gas based in Tulsa, Oklahoma for almost a century. Known for owning many natural gas processing facilities, the industry resulted in narrow margins in the last quarter. In addition, the company is notorious for exposing declined prices of natural gas liquids such as propane and ethane. However, in the last year, companies that own energy growth infrastructures have experienced a sudden drop in the price of oils and natural gas.
On Monday morning, Energy Transfer Equity endorsed an offer of $64 per share; a 32% premium to William's closing price as of June 19, 2015.
According to the spokesperson of Williams Company Inc., the unsolicited proposal “significantly undervalues Williams and would not deliver value commensurate with what Williams expects to achieve on a standalone basis and through other growth initiatives, including the pending acquisition of Williams Partners."
Williams reveals that Energy Transfer’s offer includes termination of its pending acquisition of Williams Partners LP (NYSE: WPZ). The acquisition adheres an expected result of around $13.8 billion in a stock-for-common unit transaction that was announced on May 13th.
In Monday’s pre-market trading, Williams’ stock has risen nearly 28% to $61.75; a new 52-week high if held into regular trading season. On the Friday, the stock closed at $48.34 with a 52-week range of $40.07 to $59.77.
The industry hired Barclays Plc (NYSE: BCS) and Lazard Ltd (NYSE: LAZ), to pursue strategic alternatives and concur on more valuable offers.