8-KMaterial AgreementsRegulation FDExhibits & Filings

WILLIAMS COMPANIES, INC. 8-K Report, Material Agreement (Feb 10, 2017)

Filed February 10, 2017For Securities:WMB

Summary

This 8-K filing from The Williams Companies, Inc. (WMB) on February 10, 2017, primarily reports on a material definitive agreement entered into by its subsidiary, Williams Partners L.P. (WPZ). WPZ is acquiring a 33.75% non-operated interest in the Liberty and Rome natural gas gathering systems in northern Pennsylvania from Western Gas Partners, LP (WES) in exchange for a 50% non-operated interest in West Texas midstream assets (Delaware Basin Gas Gathering System) and $155 million in cash. This strategic swap is expected to close in late Q1 or early Q2 2017. In addition, WPZ is selling its 33.33% interest in Ranch Westex JV, LLC, which holds midstream processing facilities in the Delaware Basin, to Anadarko Pecos Midstream LLC (APM) for $45 million. This sale is contingent upon the closing of the primary asset swap with WES. These transactions signal a portfolio adjustment for Williams Companies, focusing on refining its midstream asset base.

Key Highlights

  • 1Williams Partners L.P. (WPZ) is acquiring the Liberty and Rome natural gas gathering systems in northern Pennsylvania from Western Gas Partners, LP (WES).
  • 2The acquisition from WES involves WPZ exchanging its 50% interest in the Delaware Basin Gas Gathering System and $155 million in cash.
  • 3The transaction is expected to close in late first-quarter or early second-quarter of 2017, with an effective date of January 1, 2017.
  • 4WPZ is also selling its 33.33% interest in Ranch Westex JV, LLC to Anadarko Pecos Midstream LLC (APM) for $45 million.
  • 5The sale to APM is contingent on the closing of the primary asset swap with WES.
  • 6Williams Companies (WMB) owns approximately 74% of WPZ, including its general partner interest, indicating a significant indirect impact on the parent company.

Frequently Asked Questions

Williams Partners L.P. (WPZ) is acquiring WES's 33.75% non-operated interest in the Liberty and Rome natural gas gathering systems in northern Pennsylvania. In return, WPZ is giving WES its 50% non-operated interest in the Delaware Basin Gas Gathering System and $155 million in cash.

WPZ is receiving $155 million in cash from WES for the asset swap and is also selling its interest in Ranch Westex JV, LLC to APM for $45 million. These cash inflows, combined with the strategic shift in asset portfolio, are key financial considerations for investors.

The closing of the transaction is anticipated in the late first-quarter or early second-quarter of 2017, with an effective date of January 1, 2017.

Yes, the closing is subject to standard conditions, including review under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Additionally, the sale of the interest in Ranch Westex JV, LLC to APM is specifically conditioned upon the closing of the primary asset swap with WES.