Williams Cos. (WMB) raised its bid for Texas pipeline company
Southern Union Co. (SUG) to about $5.6 billion in cash in the
latest round of a takeover battle with Energy Transfer Equity LP
(ETE), topping its sweetened cash-and-stock offer of $5.1 billion
for Texas pipeline company.
Williams is now offering $44 a share, an increase of $5 a share
from its bid last month of $39 a share, or about $5 billion. The
company had been expected to raise its offer.
Southern Union shares were up 4.3% at $43.39 in recent premarket
trading.
"We are more convinced than ever of the strategic and financial
benefits of Williams' acquisition of Southern Union," Williams'
President and Chief Executive Officer Alan Armstrong said. "Based
on the terms of our premium-value, all-cash proposal, we are
confident that Southern Union's Board of Directors will determine
its superiority to the Energy Transfer agreement."
Neither Southern Union not Energy Transfer was immediately
available for comment.
Energy Transfer and Southern Union last week had set a deal
initially valued at $40 a share. Energy Transfer also agreed to
sell some assets in order for the deal to pass muster with
antitrust regulators. The companies raised the breakup fee for
their agreement to $162.5 million from $92.5 million in the
original agreement, another indication that a higher bid was
expected.
Both companies had expressed willingness to assume Southern's
debt, totaling $3.7 billion.
Williams on Thursday said its proposal isn't subject to
financing conditions and that it is committed to closing the
transaction "on a timeline consistent with the proposed Energy
Transfer transaction."
Williams shares were down 1% at $28.50 in recent premarket
trading. Energy Transfer's common units closed Wednesday at $44.78
and were inactive premarket.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com