By Alison Sider And Dana Cimilluca 

Natural-gas pipeline giant Williams Cos. has rejected an unsolicited buyout offer worth $48 billion but is open to other offers, the company said Sunday.

Williams didn't identify who made the takeover offer. A person familiar with the matter said the suitor was Energy Transfer Equity LP., based in Dallas. Energy Transfer's interest was earlier reported by Bloomberg.

Williams said it declined an all-stock offer valued at $64 a share, which is a 33% premium to where its shares closed on Friday. The company has retained Barclays and Lazard to pursue alternatives, including a merger, a sale of the company or simply continuing on its current path.

"The Williams Board carefully considered the unsolicited proposal and determined that it significantly undervalues Williams and would not deliver value commensurate with what Williams expects to achieve on a stand-alone basis and through other growth initiatives, including the pending acquisition of" Williams Partners, the company said in a statement.

In May, Williams said it planned to absorb its subsidiary, Williams Partners LP, in a $13.8 billion deal. At the time, the company said that combining and simplifying its corporate structure would make it more efficient and better able to expand in the future.

On Sunday, Williams said the offer it rejected was contingent on that simplification process being called off.

Shares of Williams Cos. have risen 7.8% so far this year to $48.34. Shares of the partnership that Williams controls closed Friday at $53.25, up 4.1% this year. Energy Transfer shares are up 19% so far this year at $68.39.

Williams has said its consolidation deal would likely close during the third quarter, giving the combined company an enterprise value of $84 billion.

Companies that own pipelines and other energy infrastructure have been somewhat insulated from the dramatic drop in the price of oil and gas over the last year. That is because they tend to operate based on fixed-fee, long-term contracts that pay the same amount of money whether energy prices are high or low.

But Williams is also exposed to the plummeting price of some fuel known as natural gas liquids, which include propane and ethane. In addition to pipelines, Williams owns many natural gas processing facilities, which earned slimmer margins this year.

Analysts have been predicting that energy transportation and storage companies would combine in a series of mergers and acquisitions.

"It's game on for consolidation and empire building," said Robert W. Baird analyst Ethan Bellamy.

Williams's roots in moving fuel around North America go back to 1919, but it was the 1995 acquisition of Transco Energy Co. that expanded its system to the U.S. East Coast and made it one of the nation's largest natural gas transporters. Today, Tulsa-based Williams owns and operates 13,600 miles of pipelines across North America.

Write to Alison Sider at alison.sider@wsj.com

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