Keith Meister & Eric Mandelblatt Step Down From Williams Board

Keith Meister's activist hedge fund firm Corvex Management has filed an amended 13D regarding its stake in Williams Companies (WMB) jointly along with Soroban Capital's Eric Mandelblatt.

Per the filing, the two gentlemen have stepped down from Williams' board of directors since the company was unwilling to replace Alan Armstrong as CEO.

You can view Meister's resignation letter here and Mandelblatt's here.

The 13D notes that their respective stakes in the company remain unchanged.

Per Google Finance, Williams is "an energy infrastructure company focused on connecting North America's hydrocarbon resource plays to markets for natural gas, natural gas liquids and olefins. The Company's segments include Williams Partners, Williams NGL & Petchem Services, and Other. Its Williams Partners segment consists of its consolidated partnership in Williams Partners L.P., including gas pipeline, which consists of interstate natural gas pipelines and pipeline joint project investments, and midstream business, which provides natural gas gathering, treating, processing and compression services. Its Canadian midstream operations include an oilsands off gas processing plant, NGL/olefin fractionation facility and the Boreal Pipeline. The Williams NGL & Petchem Services segment consists of Texas Belle pipeline, domestic olefins pipeline assets and Canadian growth projects under development. Its Other segment includes corporate operations and Canadian construction services company."

Corvex Management & Soroban Capital Add To Williams Position

Keith Meister's hedge fund firm Corvex Management filed an amended 13D in conjunction with Eric Mandelblatt's Soroban Capital regarding their joint position in Williams Companies (WMB). 

Per the filing, the hedge funds now own 8.39% of the company with over 62.68 million shares (though if you add in the options, they'd own 9.11% with around 68 million shares).

This would indicate that the hedge funds have increased their exposure by around 21 million more shares since the end of the third quarter.  The filing was made due to activity on November 18th.

Per Google Finance, Williams is "an energy infrastructure company focused on connecting North America’s hydrocarbon resource plays to markets for natural gas, natural gas liquids (NGLs), and olefins. The Company’s operations span from the deepwater Gulf of Mexico to the Canadian oil sands. It operates in three segments: Williams Partners, Midstream Canada & Olefins and Other."

For more on Corvex in particular, we recently posted up Meister's presentation on Crown Castle International.

Corvex & Soroban Expect to Increase Williams Companies Stake (13D Filing)

Keith Meister's activist hedge fund firm Corvex Management and Eric Mandelblatt's Soroban Capital have jointly filed an amended 13D with the SEC regarding their position in Williams Companies (WMB). 


Corvex/Soroban To Increase Williams Companies Stake

The filing details that the Hart Scott Rodino waiting period has expired and as such, "Corvex intend to promptly exercise their deeply in-the-money physically settled call options and Corvex and Soroban also expect to acquire additional shares, further increasing their beneficial ownership stake."

Per the 13D, the hedge funds have disclosed a 7.14% ownership stake in WMB with exposure to over 48.8 million shares.

That figure doesn't include their cash-settled swaps and options regarding an additional 19.2 million shares, so their aggregate exposure to the name can rise as high as 9.96% (with 68 million shares). And now we get word that they're likely to buy more.


Seeking Board Seats As Well

The filing indicates that the hedge funds want Mandelblatt and Meister to join the company's board, but they haven't been able to come to an agreement with the company.

We've previously posted about their Williams Companies stake earlier this year.

Per Google Finance, Williams Companies is "an energy infrastructure company focused on connecting North America’s hydrocarbon resource plays to markets for natural gas, natural gas liquids (NGLs), and olefins. Its operations span from the deepwater Gulf of Mexico to the Canadian oil sands. It operates in three segments: Williams Partners, Midstream Canada & Olefins and Other. Its interstate gas pipeline and domestic midstream interests are held through its investment in Williams Partners L.P. (WPZ). It owns the general-partner interest and a 70% limited-partner interest in WPZ. Williams also owns a Canadian midstream and domestic olefins production business, which processes oil sands off-gas and produces olefins for petrochemical feedstocks." 

For more additional recent portfolio activity from Corvex, click here.

Corvex & Soroban Add To Williams Companies Position

Keith Meister's activist hedge fund Corvex Management and Eric Mandelblatt's Soroban Capital have filed an amended 13D with the SEC regarding their position in Williams Companies (WMB).  Per the filing, the hedge funds have disclosed they now own 6.74% of WMB with over 46 million shares.

The filing indicates their latest activity was on January 9th, 2014 and this stake is up from the previous 5% of the company they owned.  We initially highlighted when these hedge funds went activist on Williams last month.

Keep in mind, however, that their position disclosure is not inclusive of cash-settled swaps and options which reference an additional 21.3 million shares.  If you add in this exposure, they would own 9.86% of the company.

Per Google Finance, Williams Companies is "an energy infrastructure company focused on connecting North America’s hydrocarbon resource plays to markets for natural gas, natural gas liquids (NGLs), and olefins. Its operations span from the deepwater Gulf of Mexico to the Canadian oil sands. It operates in three segments: Williams Partners, Midstream Canada & Olefins and Other. Its interstate gas pipeline and domestic midstream interests are held through its investment in Williams Partners L.P. (WPZ). It owns the general-partner interest and a 70% limited-partner interest in WPZ. Williams also owns a Canadian midstream and domestic olefins production business, which processes oil sands off-gas and produces olefins for petrochemical feedstocks."

Corvex Management & Soroban Capital Go Activist on Williams Companies (WMB)

Keith Meister's activist hedge fund Corvex Management and Eric Mandelblatt's Soroban Capital Partners have entered into an agreement and jointly filed a 13D on shares of Williams Companies (WMB). 

Per the filing, they've disclosed a 5.28% stake in WMB with Corvex owning 13.6 million shares and another 5 million shares underlying call options. Soroban has revealed ownership of 17.4 million shares.

This excludes cash-settled swaps and options which represent an additional 24,213,599 shares.  If these were aggregated together, Corvex and Soroban would have an aggregate economic interest of 8.82% of the company with over 60.3 million shares.

It looks like Corvex was buying call options and selling puts in Late October and throughout November while Soroban was buying shares in late October.


Activist Investment Thesis

The hedge funds have met with management and the Board to discuss the company's operations, finances, strategy and governance.  The filing indicates,

"(Williams) has a strong competitive position in an attractive industry with tremendous growth opportunities but recent operational and financial missteps have prevented the Issuer’s Shares from reflecting full value. The Reporting Persons intend to discuss the following with one or more of the persons referenced above (among other topics): enhancing the structure and value of the Issuer’s investments and assets; evaluating and financing of capital projects; optimizing the Issuer’s capital structure and dividend policy; improving the Issuer’s operational and financial execution; and the potential for participating in strategic combinations given the rapid pace of consolidation in the midstream energy industry."

Meister and Mandelblatt are also looking to join the Board.


See other recent activity from Corvex here.