Robbins LLP: Acquisition of Williams Partners L.P. (WPZ) by Williams Companies, Inc. (WMB) May Not Be in Unitholders’ Best Interests
Robbins LLP ais investigating the proposed acquisition of Williams Partners L.P. (NYSE: WPZ) by Williams Companies, Inc. (NYSE: WMB). On May 13, 2015, the two companies announced the signing of a definitive merger agreement pursuant to which Williams Companies will acquire Williams Partners. Under the terms of the agreement, Williams Partners unitholders will receive 1.115 shares of Williams Companies for each unit of Williams Partners they own, the value of which is equivalent to $55.86 per unit of Williams Partners.
Is the Proposed Acquisition Best for Williams Partners and Its Unitholders?
Robbins LLP’s investigation focuses on whether the board of directors at Williams Partners is undertaking a fair process to obtain maximum value and adequately compensate its unitholders.
As an initial matter, the $55.86 merger consideration represents a premium of only 11.9% based on Williams Partners’ closing price on April 14, 2015. This premium is significantly below the average one-month premium of nearly 20.1% for comparable transactions within the past five years. Further, the $55.86 merger consideration is below the target prices set by ten analysts ranging from $64.00, set by Ladenburg Thalmann & Co. on May 11, 2015, and $56.00 set by BMO Capital Markets on February 26, 2015. In the last three years, Williams Partners traded as high as $62.92 on November 21, 2014, and most recently traded above the offer price – at $55.95 – on December 9, 2014.
On April 29, 2015, Williams Partners reported strong quarterly earnings results for its first quarter 2015. Adjusted EBITDA was $917 million, an increase of 19% from the first quarter of 2014, and fee-based revenue was up 66% compared to last year. In commenting on these results, the Chief Executive Officer of Williams Partners’ general partner, Alan Armstrong, remarked, “First quarter 2015 results showed strong fee-based revenue growth from the Atlantic-Gulf and Northeast G&P operating areas as well as from the merger with Access. We expect the second quarter to be even higher with Gulfstar One and Keathley Canyon Connector nearing full production and additional projects being placed in service such as the Rockaway Lateral and the mainline portion of Leidy Southeast.”
In light of these facts, Robbins LLP is examining Williams Partners’ board of directors’ decision to sell the company now rather than allow unitholders to continue to participate in the company’s continued success and future growth prospects.
Williams Partners unitholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for unitholders and the disclosure of material information.
Williams Partners unitholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.