Six Williams Directors Said to Resign After Failed TakeoverBy
Almost half of board said to resign following failed merger
Directors resigned after attempt to oust CEO, WSJ says
Six of Williams Cos.’s 13 directors, including independent chairman Frank T. MacInnis and activist investors Keith Meister and Eric Mandelblatt, have resigned, a person with knowledge of the situation said Thursday, asking not to be identified because the information isn’t public.
The Wall Street Journal reported earlier Thursday that the directors stepped down after a failed attempt to oust Williams Chief Executive Officer Alan Armstrong. Their departures come less than a week after Williams lost a court case that killed its $33 billion takeover by Energy Transfer Equity LP.
Meister, who manages the hedge fund Corvex Management LP, and Mandelblatt, a managing partner at Soroban Capital Partners, were instrumental in building support for the takeover, putting them at odds with Armstrong, who had rebuffed the would-be buyer’s advances. Their resignations may build confidence in the company’s leadership as it works to emerge from a failed fight to salvage the merger that dragged on for months.
“One of the questions I and other shareholders have, and the employee bases have, is: Who is leading the company?” Rob Thummel, a managing director at Tortoise Capital Advisors LLC, said Thursday. “It appears to me that they’ve answered that question. Alan is going to lead the company. He’s our CEO moving forward.”
Williams spokesman Lance Latham declined by telephone to comment and said the company would issue a statement.
The other board members who resigned include Ralph Izzo, chief executive officer of New Jersey’s Public Service Enterprise Group Inc., and Steven Nance, said the person familiar with the departures, who couldn’t immediately identify the sixth to leave. MacInnis, Meister, Mandelblatt and Nance couldn’t immediately be reached for comment. Izzo declined by e-mail to comment.
The division among directors stands in stark contrast to a January statement from Williams in which the company said its board was “unanimously committed” to closing on the Energy Transfer merger.
Armstrong was, “for all intents and purposes, put on the sideline in the context of the merger discussions, and it was carried on by the independent chairman and others,” said Keith E. Bailey, a former Williams CEO and a shareholder. “That’s not healthy. The company is positioned now to refocus.”
Should Armstrong be terminated without cause, his stock awards would vest early and he’d get a pro-rated portion of his annual bonus, altogether valued at $8.8 million as of Dec. 31, the company’s annual report shows.
Armstrong has worked at Williams for 30 years and has served as its chief executive officer for more than five years. Before becoming CEO, he was president of the company’s midstream and olefins businesses in North America, the Tulsa, Oklahoma-based pipeline operator’s website shows.
“Alan is probably not the most dynamic leader in the industry, but he has led a company that owns a very strategic set of assets and built new assets and has done a pretty good job of that,” Thummel said. “We’d just love for all these uncertainties to go away so Williams can get back to what they do well.”