ETE, Williams give SEC more time to review their deal

ETE, Williams deal worth $20 billion


ETE may use the additional time to renegotiate terms of the deal ahead of the June 28 deadline. Energy Transfer Equity photo.

May 3 (Reuters) – Energy Transfer Equity LP, or ETE, and Williams Companies Inc agreed on Tuesday to change an administrative requirement for their $20 billion-deal to give U.S. regulators additional time to complete their review of the tie-up.

The new timeline may give Energy Transfer time to renegotiate terms of the deal ahead of June 28 – the deadline for the deal to close, people familiar with the matter told Reuters on Monday.

The companies said in a regulatory filing on Tuesday that the Securities and Exchange Commission had requested additional information about the deal to be included in the proxy statement, which the companies may not mail to shareholders before the SEC completes its review.

Williams shareholders need to vote on the transaction, and the SEC must sign off on the proxy statement before it is sent out to shareholders and a date is set for the vote.

The companies agreed to shorten the period between when the proxy and form of election are sent and when the deal can close. The form of election allows Williams shareholders to choose whether they want cash or stock for their shares.

Energy Transfer chief executive Kelcy Warren, a Dallas billionaire, set his sights on Williams last year to transform his empire into one of the biggest pipeline networks in the world. However, a prolonged drop in oil and gas prices has made the deal less economically attractive.

Williams is suing ETE in Delaware to stop a controversial offering of preferred shares to its top shareholders. It has also sued Energy Transfer’s Warren in Texas over the same offering.

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Williams has alleged that ETE is looking into ways to walk away from the tie-up even though the terms of the deal would not allow that.

The latest obstacle to the deal arose last month, when Energy Transfer said its lawyers may not be able to deliver a tax opinion needed to close the deal. Williams disagrees with the position Energy Transfer’s lawyers have taken on the tax issue.

(Reporting by Michael Erman in New York and Swetha Gopinath in Bengaluru; Editing by Sayantani Ghosh and Chizu Nomiyama)

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