Bloomberg News

Williams Discussed Buying Parts of Southern Union After Sale

October 11, 2011

(Updates with details of discussions in second paragraph.)

Oct. 11 (Bloomberg) -- Williams Cos. asked Energy Transfer Equity LP if it would sell some of Southern Union Co.’s pipelines after Energy Transfer buys Southern Union later this year.

Williams Chief Executive Officer Alan Armstrong e-mailed Energy Transfer CEO Kelcy Warren on Sept. 2, asking if the companies could discuss some of Southern Union’s assets. Williams was interested in Southern Union’s Citrus Corp. subsidiary, which owns 50 percent of the Florida Gas Transmission Co., along with the Trunkline system that runs from the Gulf of Mexico to Michigan, and the Panhandle system that runs from Texas and Oklahoma to the Midwest, according to a filing from Energy Transfer today.

The Southern Union board agreed to allow the discussions on Sept. 5. The two companies ended the talks Oct. 9 after they were “unable to reach an agreement,” the filing said.

Williams and Energy Transfer have been competing to buy Houston-based Southern Union since June. Energy Transfer has increased its offer twice to outbid Williams, most recently to $5.1 billion. A date for a shareholder vote has not been released. The transaction would be the largest purchase of a pipeline company in the U.S. this year, according to Bloomberg data.

Jeff Pounds, a spokesman for Williams in Tulsa, Oklahoma, said the company would not comment. Vicki Anderson Granado, a spokeswoman for Dallas-based Energy Transfer, said the company would not comment beyond the filing.

--Editors: Jasmina Kelemen, Charles Siler

To contact the reporter on this story: Mike Lee in Dallas at mlee326@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net


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