Williams Outgoing Directors Air Grievances with CEO--Update
July 01 2016 - 01:34PM
Dow Jones News
By Alison Sider
Two activist investors who resigned their seats on the board of
Williams Cos. vowed to keep pushing for changes at the pipeline
giant and aired their grievances with Chief Executive Alan
Armstrong in letters released Friday.
Keith Meister of Corvex Management LP and Eric Mandelblatt of
Soroban Capital Partners were among the six board members to resign
Thursday amid a dispute over who should lead Williams in the wake
of a failed merger with Energy Transfer Equity LP.
The bloc fought against keeping Mr. Armstrong at the helm as
Williams prepares to set a new course and contemplates its future
as an independent company. But the directors not including Mr.
Armstrong were split evenly, with six supporting Mr. Armstrong and
six opposed, so Mr. Armstrong kept his job.
"I cannot serve on a board that continues to empower a CEO with
an abysmal operational and financial track record, and who in my
opinion lacks the necessary judgment and character to lead the
company forward," Mr. Mandelblatt wrote in a resignation letter
filed with the Securities and Exchange Commission.
Mr. Meister and Mr. Mandelblatt joined the board in 2014
following a public campaign, and both indicated in resignation
letters that they don't plan to go quietly. Together, they own an
8.4% stake in the company.
"Ironically, given the current CEO and board leadership, I
believe I will be more effective from outside the company than
within, and will seek to protect our interests and the interest of
other shareholders from outside this diminished boardroom," Mr.
Meister wrote in his resignation letter filed with the U.S.
regulator.
The future of Williams, which operates natural gas pipelines
around the country, is unclear after a protracted, troubled merger
proposal from Energy Transfer went sideways.
Last week, a Delaware judge ruled that Energy Transfer could
walk away from its proposed takeover of Williams, which was once
valued at $33 billion, and Energy Transfer notified Williams this
week that it wouldn't close the deal. Williams is appealing the
court's decision.
In a statement Friday, Williams said Mr. Armstrong was the best
person to lead the company gong forward.
"The 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 enhancing stockholder value," Williams said in a news
release.
The company said it would "evaluate the appropriate size and
composition of the board going forward."
Shares of Williams fell 4.6% to $20.63 in midday trading in New
York.
Kathleen Cooper, a current director and member of the audit
committee member has been appointed chairman of the board,
replacing Frank MacInnis, who resigned his post at chairman. Mr.
MacInnis resigned for personal reasons, though he was among those
who disagreed with the decision to keep Mr. Armstrong as CEO, the
company said.
The other board members resigning include Laura Sugg, a former
executive at ConocoPhillips; Ralph Izzo, CEO of utility giant
Public Service Enterprise Group Inc.; and Steven Nance, president
of a privately held oil and gas company.
The resignations were first reported Thursday by The Wall Street
Journal.
Liz Hoffman and David Benoit contributed to this article.
Write to Alison Sider at alison.sider@wsj.com
(END) Dow Jones Newswires
July 01, 2016 13:19 ET (17:19 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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