Summary
The Williams Companies, Inc. (WMB) filed an 8-K on November 10, 2011, detailing a revision to its previously announced plan to separate its exploration and production business, WPX Energy, Inc. (WPX). The company's Board of Directors approved a revised plan to achieve a complete separation of WPX through a tax-free spin-off to Williams' shareholders by the end of 2011. This is a departure from the earlier plan which included an initial public offering (IPO) of up to 20% of WPX. While the revised plan is the primary focus, the company has retained the discretion to pursue the original IPO plan if market conditions are favorable. In connection with this strategic move, two board members, William R. Granberry and William G. Lowrie, have submitted resignations, effective immediately prior to the WPX spin-off. These directors are slated to become prospective directors of WPX post-separation. Their resignations are not due to any disagreement with the company. Investors should monitor the progress of the WPX spin-off and any further strategic decisions regarding the separated entity.
Key Highlights
- 1Williams Companies (WMB) announced a revised plan to separate its WPX Energy subsidiary via a tax-free spin-off by year-end 2011.
- 2The revised plan calls for a complete separation, differing from the prior plan that included an IPO of up to 20% of WPX.
- 3Williams retains the discretion to pursue the original IPO plan if market conditions become favorable.
- 4Two Board members, William R. Granberry and William G. Lowrie, will resign effective immediately preceding the WPX spin-off.
- 5These departing directors are designated as prospective directors for WPX following the separation.
- 6The resignations are not a result of any disagreement with The Williams Companies.
- 7The spin-off transaction is subject to market conditions and the company's discretion.