Williams director felt threatened to back ETE deal -trial

By Tom Hals
GEORGETOWN, De., June 20 (Reuters) -- A Williams Cos Incorporation board member testified she felt pressured by her own company to support a $20 billion merger with pipeline company Energy Exchange Equity LP, which ETE lawyers sought to depict as proof that Williams misrepresented its board's support for the deal.
The 2 companies are suing every other as Energy Move Equity, or ETE, searches for a way to back out of the deal, which would create a single of the sma ngentot world's largest operators of pipeline to carry oil and fuel.
The two-day trial in Delaware's Court of Chancery before Vice Chancellor Sam Glasscock opened on Monday.
Williams is asking the particular judge to force ETE to complete the takeover, alleging that the business and its chief executive, Dallas billionaire Kelcy Warren, have purposely worked in order to scuttle the agreed-upon deal.
ETE has countersued, arguing that Williams has breached the merger agreement, in part by misrepresenting the level of its board's support for the deal.
On Monday, ETE attorneys played video deposition testimony of director Kathleen Cooper which they said highlighted that Williams board members were threatened using the risk of a campaign to have them removed if they did not support the offer.
Cooper voted against the particular deal. She was amongst the five directors upon Williams' 13-member board that did not back the particular takeover.
Asked during her deposition earlier this 30 days if she had felt threatened to change her vote, she said the lady did.
Williams' chairman, Frank MacInnis, downplayed Cooper's accounts and said the panel discussed the possible fall-out from a vote against the deal.
"There was never a threat, " MacInnis told the courtroom.



BUYER'S REMORSE
The two-day trial arrives just days before the scheduled June 27 vote by Williams shareholders on whether they want to accept the offer proposed within September by ETE.
Whilst the deal was long-sought by Warren, Williams stated he soon came lower with buyer's remorse plus began to search with regard to a solution as an energy price slump deepened.
ETE has made obvious that it believes the deal has ceased to be attractive. This has slashed estimates for expected cost savings plus said it would most likely have to cut distributions to shareholders entirely next yr if it needs to full the deal.
ETE offers argued the deal are unable to close because its attorneys at Latham & Watkins were unable to declare that will it would be tax-free. The company originally raised the particular tax problem in April and rejected two possible solutions proposed by Williams.
Williams sued in May, accusing Warren of failing to meet its obligation to try to get the merger done simply by June 28, when ETE can walk away with out penalty.
Williams' legal team on Monday showed a video deposition of Jamie Welch, who had been fired earlier this year as ETE's chief financial officer.
He or she said that as earlier as January, Warren had grown opposed to the offer. He began pressing his management team and attorneys to comprehend ETE's rights with respect to terminating the particular deal.
"He feared for future years of the Energy Transfer enterprise if the offer with Williams had to close on its current conditions, " Welch said in the video played within court. He said Warren feared an "implosion" from the business. (Additional reporting by Michael Erman in Nyc; Editing by Matthew Lewis)