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Williams (WMB) to Divest Canadian Business for Funding Needs
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Williams Companies Inc. (WMB - Free Report) and Williams Partners LP have decided to divest their Canadian businesses to Inter Pipeline Ltd for a total consideration of U.S. $1.03 billion. The deal will likely lower the requirement of energy infrastructure providers to depend on capital markets for raising funds.
From the sale, after adjusting for certain items, Williams Companies will get U.S. $209 million whereas Williams Partners is anticipated to obtain U.S. $817 million. The transaction will likely be completed in 2016.
According to Alan Armstrong –President and Chief Executive Officer of Williams–the accord marks significant advancement on this year’s capital and financial program. In other words, the agreement will help the players to finance a considerable part of their growth projects like expanding the far-reaching pipeline networks. The proceeds will also be utilized to lower debts under credit facilities.
The need for capital got reflected when Williams Companies announced last week that it intends to reduce its dividend by 69%. With the dividend cut, the company will be able to invest about $1.7 billion in its arm Williams Partners that badly requires financing through 2017. Investors should know that the motive for lowering dividend stems from the prior event when the natural gas pipeline company failed to merge with Energy Transfer Equity LP .
Tulsa, OK-based Williams Companies is a premier energy infrastructure provider in North America. The company’s core operations include finding, producing, gathering, processing and transportation of natural gas. Boasting a widespread pipeline system, Williams is one of the largest domestic transporters of natural gas by volume.
Last week, Williams Companies reported decent second-quarter 2016 earnings courtesy of significant cost reductions and continued improvement in financial performance. The company reported adjusted earnings from continuing operations of 19 cents per share, in line with the Zacks Consensus Estimate. Moreover, the bottom line improved from the prior-year figure of 15 cents per share.
Presently, Williams Companies carries a Zacks Rank #3 (Hold), implying that the stock will perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, a better-ranked player in the energy sector is North Atlantic Drilling Limited . The stock sports a Zacks Rank #1 (Strong Buy).
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Williams (WMB) to Divest Canadian Business for Funding Needs
Williams Companies Inc. (WMB - Free Report) and Williams Partners LP have decided to divest their Canadian businesses to Inter Pipeline Ltd for a total consideration of U.S. $1.03 billion. The deal will likely lower the requirement of energy infrastructure providers to depend on capital markets for raising funds.
From the sale, after adjusting for certain items, Williams Companies will get U.S. $209 million whereas Williams Partners is anticipated to obtain U.S. $817 million. The transaction will likely be completed in 2016.
According to Alan Armstrong –President and Chief Executive Officer of Williams–the accord marks significant advancement on this year’s capital and financial program. In other words, the agreement will help the players to finance a considerable part of their growth projects like expanding the far-reaching pipeline networks. The proceeds will also be utilized to lower debts under credit facilities.
The need for capital got reflected when Williams Companies announced last week that it intends to reduce its dividend by 69%. With the dividend cut, the company will be able to invest about $1.7 billion in its arm Williams Partners that badly requires financing through 2017. Investors should know that the motive for lowering dividend stems from the prior event when the natural gas pipeline company failed to merge with Energy Transfer Equity LP .
Tulsa, OK-based Williams Companies is a premier energy infrastructure provider in North America. The company’s core operations include finding, producing, gathering, processing and transportation of natural gas. Boasting a widespread pipeline system, Williams is one of the largest domestic transporters of natural gas by volume.
Last week, Williams Companies reported decent second-quarter 2016 earnings courtesy of significant cost reductions and continued improvement in financial performance. The company reported adjusted earnings from continuing operations of 19 cents per share, in line with the Zacks Consensus Estimate. Moreover, the bottom line improved from the prior-year figure of 15 cents per share.
Presently, Williams Companies carries a Zacks Rank #3 (Hold), implying that the stock will perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, a better-ranked player in the energy sector is North Atlantic Drilling Limited . The stock sports a Zacks Rank #1 (Strong Buy).
WILLIAMS COS Price, Consensus and EPS Surprise
WILLIAMS COS Price, Consensus and EPS Surprise | WILLIAMS COS Quote
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