Williams says 75% of Feline PACS tendered in exchange

New York, Oct. 19 - Williams Cos. Inc. said holders tendered 33.1 million or 75% of its 44.0 million outstanding Feline PACS in the form of Income PACS.

The Tulsa, Okla., natural gas production and transportation company will issue 33.1 million shares of common stock and pay $48.6 million of cash for the tendered convertibles.

The exchange expired at 5 p.m. ET on Oct. 18.

Williams said the exchange will reduce its debt by $827 million.

On Sept. 17, Williams announced it had begun the exchange in which it was offering stock and cash for its Income PACS.

The exchange covers up to 43.9 million of the 44 million PACS outstanding. Williams issued the securities in January 2002, raising $1.1 billion.

Williams is offering one share of common stock plus $1.47 in cash for each PAC.

The PACS closed at $13.34 on Sept. 16 while Williams' stock closed at $12.05.

Under their terms, the PACS exchange on Feb. 16, 2005 into one share of Williams stock, assuming the stock is at $41.25 or less.

Williams noted that the $1.47 cash payment is more than the remaining interest payments on the PACS.

Merrill Lynch, Pierce, Fenner & Smith Inc. (888 654-8637) was lead dealer manager for the offer. Citigroup Global Markets Inc. and Banc of America Securities LLC were co-dealer managers. D.F. King & Co. Inc. (800 848-2998) was the information agent. JPMorgan Chase Bank was the exchange agent for the offer.

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