DOW JONES NEWSWIRES
Texas pipeline company Southern Union Co. (SUG) agreed to a
sweetened $5.7 billion cash-and-stock buyout offer from Energy
Transfer Equity LP (ETE) instead of a bid from rival suitor
Williams Cos. (WMB)
Under Energy Transfer's latest offer, Southern Union holders can
elect to receive $44.25 in cash or one Energy Transfer Equity
common unit, worth $44.03 as of Monday's close. The total value of
the deal, including debt assumption, is about $9.4 billion.
Energy Transfer and Williams have been competing to merge with
Southern. The successful suitor is expected to become the country's
largest natural-gas pipeline company following the deal.
Williams last week had raised its bid to $5.6 billion, or $44 a
share. Southern had said at that time it would review the Williams
proposal, but its board also had reaffirmed its recommendation for
an existing Energy Transfer accord.
A Williams spokesperson wasn't immediately available for
comment.
The bidding for Southern Union started in mid-June with a $4.2
billion offer from Energy Transfer.
Energy Transfer on Tuesday also reached an amended agreement to
sell Southern Union's 50% interest in Citrus Corp., owner of the
Florida Gas Transmission pipeline system, to Energy Transfer
Partners LP (ETP) for $2 billion. Regulators are requiring Energy
Transfer Equity to sell the stake when the Southern Union
acquisition closes.
Southern Union shares were up 1.8% at $44.09 in recent trading,
while Energy Transfer was off 0.3% at $43.88. Williams was up 2
cents at $27.09.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com