Middle East

Energy transfer must pay Williams $ 410 million


December 30, 2021

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A judge in Delaware ordered oil pipeline operator Energy Transfer LP to pay $ 410 million for abandoning the $ 33 billion merger with rival Williams Cos. This is one of the biggest deals at the expense of falling oil prices.

In a decision on page 95 on Wednesday, Deputy Prime Minister Sam Glasscock of the Delaware State Equality Court charged a split fee for violating the September 2015 merger agreement by issuing preferred securities five months after the energy transfer. He said he was obliged to pay.

Energy Transfer provided securities only to insiders. One Williams director, co-founder Kelcy Warren, chairman of Energy Transfer’s billionaire, called it a “lovers deal” for the CEO of the time.

Glasscock writes that while Dallas-based Energy Transfer has successfully terminated the merger, it is contractually obliged to pay a split fee and therefore “pay to Piper.”

The judge also said that after Williams CEO Alun Armstrong deleted his Gmail account, Williams would have to pay for the energy transfer to issue a subpoena and seek sanctions. rice field.

In a statement emailed Thursday, Energy Transfer said it was “extremely disappointed” with the decision and its evaluation of its legal options.

Williams, based in Tulsa, Oklahoma, said he was “clearly pleased” to be able to recover interest and statutory costs in addition to the $ 410 million split fee.

After the oil and gas prices fell, the merger collapsed in the spring of 2016, damaging the shares of both companies, and investors were worried that the merged company would be in heavy debt.

After the trial, in June 2016 Glasscock had Energy Transfer withdraw the merger because the tax accountant was unable to prove to investors that the transaction was tax exempt, as originally envisioned.

Later, Glasscock said in December 2017 that Energy Transfer was not entitled to a $ 1.5 billion split fee from Williams and that leaving would be a “dive.”

The incident was Williams Cos v Energy Transfer LP, Delaware Chancery Court, No. It is 12168 and 12337.

(Report by Jonathan Stempel, edited by Dan Grebler and Chizu Nomiyama)

https://www.oedigital.com/news/493196-energy-transfer-must-pay-williams-410-million-for-abandoning-33-billion-merger Energy transfer must pay Williams $ 410 million

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