Home / Knowledge / News / Textiles / Williams Partners to purchase Williams' Gulf Olefins Biz
Williams Partners to purchase Williams' Gulf Olefins Biz
02
Nov '12
Williams Partners and Williams announced an agreement for Williams Partners to acquire Williams' approximately 83-percent undivided interest in the Geismar olefins production facility, as well as Williams' refinery-grade propylene splitter for $2.264 billion and pipelines in the Gulf region, for $100 million. Additionally, Williams Partners will be responsible for the completion of the ongoing expansion of the Geismar facility projected to cost $270 million and additional pipelines projected to cost approximately $160 million.
 
Williams also agreed to temporarily waive approximately $16 million per quarter of general partner incentive distribution rights (IDRs) until the later of Dec. 31, 2013 or 30 days after the Geismar plant expansion is operational. Williams estimates the foregone IDRs will last approximately five quarters, which would total $80 million.
 
The table below presents a comparison of expected post-expansion segment profit plus DD&A for 2014 to the transaction price for these assets. 2014 is expected to be the first full year of operations at the Geismar facility following the expansion, expected to be completed in late 2013. As a result, 2014 is more representative of the Geismar facility's long-term earnings and cash flow generation capacity.
 
The partnership expects the addition of olefins production to its business would bring more certainty to cash flows that today are exposed to the market for ethane, which is projected to experience periods of volatility as feedstock demand for infrastructure lags new supplies from shale-gas production. North American ethylene demand is expected to remain strong, given its continuing advantaged cost compared with ethylene derived from crude-oil based feedstock.
 
Williams Partners expects that the addition of olefins production to its business via this acquisition will be accretive to distributable cash flow, on a per-unit basis for the partnership's unitholders. Williams Partners plans to fund the acquisition with the issuance to Williams of 42.8 million Williams Partners limited-partner units, $25 million in cash and an increase to the general partner's capital account to maintain Williams' 2-percent general-partner interest. The transaction is expected to close in early November.
 
Williams will gain increased distributions from Williams Partners for the limited-partner units it will receive as consideration for the transaction. The increased distributions from Williams Partners support Williams' dividend growth strategy.
 
 


Must ReadView All

Pic: Modanisa

Apparel/Garments | On 23rd Mar 2019

European bank invests in Turkish fashion e-com platform

The European Bank for Reconstruction and Development (EBRD) recently...

UNIDO to train cotton farmers in Egypt on sustainability

Textiles | On 23rd Mar 2019

UNIDO to train cotton farmers in Egypt on sustainability

The United Nations Industrial Development Organisation (UNIDO) has...

China to boost investment in Bangladesh: envoy

Textiles | On 23rd Mar 2019

China to boost investment in Bangladesh: envoy

China would facilitate more investment by its companies and small and ...

Interviews View All

Headhonchos, Textiles & allied industry

Headhonchos
Textiles & allied industry

Textiles industry is always in the forefront in accepting latest technology

Sunil Rathore, Lacoste India

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Awen Delaval, Samatoa

Awen Delaval
Samatoa

'Natural fibres are appreciated for traditional authenticity'

Liz Manning,

Liz Manning

<div><b>Liz Manning</b>, Business Development Manager at Catexel, has...

Erik Sy,

Erik Sy

Manila-based CustomThread is a start-up offering premium custom apparel...

Larry Fontana,

Larry Fontana

Italy-based Lafer SpA is one of the most innovative surface finishing...

Mark Paterson, Technical Absorbents Ltd

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Mr Ambrose Chan, DSG International (Thailand) PLC

Mr Ambrose Chan
DSG International (Thailand) PLC

Dave Rousse, INDA

Dave Rousse
INDA

INDA, the Association of the Nonwoven Fabrics Industry, serves hundreds of ...

Rupa Sood and Sharan Apparao, Nayaab

Rupa Sood and Sharan Apparao
Nayaab

Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...

Ritu Kumar, Label Ritu Kumar

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Robert Brunner, Devereux

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


March 2019

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search