Williams and ETE Reach Agreement on One Aspect of Messy Merger

agreementA report by Energy Law 360 indicates a settlement of sorts about joint disclosures of tax consequences has been made by the Williams Cos. of Tulsa and Dallas-based Energy transfer Equity LP in their proposed merger that’s turned into a legal fight.

The energy law website indicates that attorneys for both sides told a Delaware Chancery Court judge that negotiations led to a rough agreement by both companies in the $38 billion merger.

It was weeks ago when ETE indicated its lawyers might not be able to deliver an important tax opinion for its takeover of Williams Cos. Inc. At question was whether the acquisition qualified as an exchange under section 721(a) of the U.S. tax code and would be tax free for Energy Transfer and Williams shareholders. Williams disagreed with the position on the tax issue and in April, the two firms started talks over the impact the tax issue would have on the ability to close the merger.