Antitrust Concerns Simmer as Williams Presses Deal for Southern Union

Competition for Southern Union Co. has reheated -- along with antitrust concerns -- as the owner of a Florida natural-gas pipeline this week affirmed its intent to buy the company.

Southern Union, which operates a second pipeline serving the state, has been the target of a prolonged bidding war by Williams Cos. and Energy Transfer Equity.

It looked like ETE would win out, since its $5.7 billion offer trumped Williams' $5.6 billion bid, and Southern Union's board appeared poised to accept the ETE package.

But Williams said its proposal is superior because it's an all-cash deal, whereas ETE's offer is a combination of cash and stock. On Tuesday, Williams calculated its package at a 4 percent premium over the implied value of ETE's offer.

We expect that your shareholders will greatly appreciate the certainty provided by our offer, Alan S. Armstrong, Williams chief executive, wrote in the letter to Southern Union's board.

If the sale goes Williams' way, an antitrust case could ensue, as the two largest natural gas pipelines would be under that company's control. Stay tuned.