Summary
The Williams Companies, Inc. (WMB) filed an 8-K report on June 24, 2014, announcing the completion of a significant $1.9 billion registered offering of debt securities. This offering comprised $1.25 billion in 4.550% Senior Notes due 2024 and $650 million in 5.750% Senior Notes due 2044. These new notes are senior unsecured obligations of the company and rank equally with existing senior indebtedness. The primary purpose of this debt issuance is to fund the company's proposed acquisition of certain interests in Access Midstream Partners, L.P. from entities managed by Global Infrastructure Management, L.L.C. The issuance includes specific covenants and redemption provisions tied to the consummation of this acquisition, with a deadline of December 31, 2014, for the acquisition to close. Failure to close by this date, or a management decision that the acquisition will not close, triggers mandatory redemption requirements for these notes at a premium.
Key Highlights
- 1Completed a $1.9 billion registered offering of senior unsecured debt, consisting of 4.550% Senior Notes due 2024 ($1.25 billion) and 5.750% Senior Notes due 2044 ($650 million).
- 2The debt issuance is intended to finance the proposed acquisition of interests in Access Midstream Partners, L.P.
- 3Notes are senior unsecured obligations, ranking equally with other senior indebtedness.
- 4Includes specific covenants restricting the use of proceeds and further asset encumbrances.
- 5Mandatory redemption at 101% of principal plus accrued interest if the Access Midstream Partners acquisition does not close by December 31, 2014.
- 6The company has the option to redeem the notes at 101% of principal plus accrued interest if they determine the acquisition will not close by December 31, 2014.
- 7Standard 'make-whole' redemption provisions and regular call options at par after specified dates are also included as per the indenture.