Frank MacInnis is stepping down as board chairman of Williams Companies due to personal reasons, the Oklahoma-based company said in a statement. Kathleen Cooper, a current director and audit committee member, has been appointed as his replacement.
“Frank has indicated that, due to personal reasons, he does not believe that he can dedicate the time and attention he believes necessary to fulfill the role of chairman as Williams pursues a standalone strategy,” Williams’ president and chief executive Alan Armstrong said, adding that the company is grateful for MacInnis’ many years of service.
MacInnis’ resignation comes days after a Delaware court ruled that Energy Transfer Equities, the natural gas pipeline operator that had offered to buy Williams last September, had the right to terminate the merger agreement. The $37.7 billion deal would have created the largest energy infrastructure group in the US.
Williams is fighting the Delaware Court of Chancery’s 24 June ruling, having filed an appeal with the Delaware Supreme Court.
“Williams does not believe ETE had a right to terminate the merger agreement because ETE breached the merger agreement by (among other reasons) failing to cooperate and use necessary efforts to satisfy the conditions to closing, including delivery of Latham & Watkins LLP’s Section 721(a) tax opinion,” Williams said in a statement.
The Oklahoma-based company said it is seeking monetary damages, and other remedies, from ETE for its breaches.
As Williams continues its court battle against ETE, on Friday it said that its board of directors “has thoroughly evaluated the company’s leadership structure and determined that Alan Armstrong is the right chief executive officer for Williams as the company works to continue adding stockholder value,” expressing support for the chief executive who has held that position since January 2011.
However, board members Ralph Izzo, Eric Mandelblatt, Keith Meister, Steven Nance and Laura Sugg said they “disagreed with this strategic direction of the Williams board of directors,” and have therefore decided to resign. MacInnis also expressed disagreement although the reason for his resignation was attributed to “personal reasons”.
“Williams will evaluate the appropriate size and composition of the board going forward in accordance with its standard nominating and governance procedures,” the company said, adding that further details regarding its strategic plan will be disclosed in the coming weeks.
Should the merger not proceed, the impact on ETE is expected to be neutral, Fitch said in a note last week.
“Fitch believes that termination of the merger is marginally beneficial to ETE’s near-term credit profile but not enough to impact current ratings,” the ratings agency stated. “The merger failing to close will alleviate some of the balance sheet pressure that the merger would have placed on ETE given the addition of approximately $6.0 billion in merger debt and the roughly $5.1 billion in WMB [The Williams Companies] level debt that ETE was expected to assume.”
Fitch currently rates ETE, a master limited partnership that owns the general partner and 100 percent of the incentive distribution rights of Energy Transfer Partners and Sunoco, as follows: Long-term issuer default rating BB; secured senior notes BB+, secured term loan BB+, secured revolving credit facility BB+; and rating outlook stable.