M&A; Activity around the Globe: WMB, SUG, COP, Lafarge, Etex Group
Thursday, July 14, 2021 11:40 AM

As the US stocks retreat from session highs after the Federal Reserve Chairman Ben Bernanke told Congress the central bank was not ready at this point to take further action to bolster the economy, several M&A activities took place around the world. Some notable M&A activities are discussed here.

Williams Raises Bid to $5.5 Billion for Southern Union

Williams Companies Inc. (NYSE: WMB) said Thursday, that it submitted an enhanced proposal to acquire Southern Union Company (NYSE: SUG) for $44.00 per share in cash, for a total enterprise value of $9.4 billion. Williams conveyed the all-cash, premium proposal via a letter to the Special Committee of Southern Union's board of directors. The move extends the bidding war for the pipeline operator as the latest bid topped a revised $5.1 billion offer from Energy Transfer Equity LP (NYSE: ETE). Under the terms of the new offer, Williams would pay $44 a share in cash for Southern Union, above both its original $39 offer and the $40 cash-and-stock revised bid that Energy Transfer disclosed last week. The Williams proposal also represents a premium of 56 percent over Southern Union's closing share price of $28.26 on June 15, 2011, the last trading day prior to the initial Energy Transfer announcement. WMB is up 1.84 percent to $29.32, while SUG gained 4.64 percent to $43.53 on Thursday.

ConocoPhillips to Split in Two: Refining, Production Operations

ConocoPhillips said Thursday that its board of directors has approved pursuing the separation of the company’s Refining & Marketing and Exploration & Production businesses into two stand-alone, publicly traded corporations via a tax-free spin of the refining and marketing business to ConocoPhillips shareholders. The move is consistent with ConocoPhillips’ previously stated strategies and focus on value creation for its shareholders. After the completion of the proposed separation, ConocoPhillips will be a large and geographically diverse pure-play exploration and production company with strong returns and investment opportunities. The separation of the companies is expected to be completed in the first half of 2012. Upon completion of the separation, Mulva intends to retire. Until that point, he will continue to serve as ConocoPhillips’ CEO and lead the separation efforts. Shares of ConocoPhillips gained 5.19 percent to $78.26 a share on Thursday.

Lafarge to Sell Plaster Assets

French cement maker Lafarge SA said Thursday that it is in talks with Belgium’s Etex Group to sell most of its plaster activities in Europe and South America for $1.2 billion (850 million euros). The move to sell its assets is part of plan to cut its debt by 2 billion euros. The deal also exceeds Lafarge’s target of $750 million euros of assets as part of the same plan. Lafarge Chief Executive Bruno Lafont said on Thursday that he expected to complete the transaction before year-end. The transaction gives the combined units being sold an enterprise value of 1 billion euros. Lafarge will retain a 20 percent stake in the new entity created to control the activities which it could sell to Etex within five years. The plaster division, the smallest at the company, generated about 9 percent of the group's sales last year, with revenue of 1.4 billion euros and current operating profit of 58 million.