Sam Zell is chairman of Chicago based Equity Group InvestmentsCorvex Management LP’s Keith Meister said he’ll nominate up to 10 people for the Williams Cos. board of directors and that he’s looking for the “Sam Zell” of the energy pipeline industry.
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Your current subscription does not provide access to this content. In the interview Meister said that the three new interim board members are not enough because the Williams board had six members who resigned at the end of June.
Williams Cos. said in its statement Monday that it would continue with that plan and expects to announce the board appointments soon.
Corvex’s strategy is explained in part because of the deadline it faced between the time Meister stepped down from the board on June 30 and Thursday’s nomination deadline to propose directors.
“The board reached out to Mr. Meister regarding the Corvex proposal and indicated that including the new directors in board deliberations would allow the board to take immediate advantage of the expertise, experience and insight of the new directors”.
“Given the events of the a year ago, it is unfortunate that Corvex intends to launch a distracting and costly proxy contest while Williams is moving forward with its plan to identify new, highly qualified and independent directors”, the company said in a statement.
In response to Meister’s criticism, Williams pointed to its previously announced plan to add three new independent directors, who have yet to be named by the company.
A Williams spokesman was not immediately available for comment.
Shares of Williams were down 2 cents at $27.66 in afternoon trading on August 22. The activist investor said his 10 nominees would be Corvex employees, who would be replaced shortly after taking their positions by independent directors recruited by the hedge fund.
“I have never heard of electing directors who will then resign”, said University of DE finance professor Charles Elson, who follows corporate governance.
Mr. Meister said the fight would be to get a board that is accountable to shareholders and not Chief Executive Alan Armstrong. “In sum, I’d say it’s very much a 1970’s board, where there are six directors whose qualifications I would question”. Difference in view over the management was the reason why the resignations were seen, according to Mr. Meister. Armstrong opposed that merger last summer – while Mandelblatt and Meister lobbied other directors to support it – and said in an interview earlier this month that he’s excited to finally carry out his vision for the Tulsa, Oklahoma-based company after a “stressful” year.
Williams’s future – and Armstrong’s place in leading it – has come under scrutiny since Dallas-based Energy Transfer Equity LP terminated its $32.9 billion takeover of Williams in June.
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Williams’ shares are up around 27 percent since the resignation of almost half its board June 30.
