The bidding war is intensifying for pipeline company Southern Union Co.
Williams Cos. said Thursday it is increasing its offer in an effort to overshadow a competing bid from Energy Transfer Equity LP.
The new all-cash offer values Southern Union at about $9.4 billion. That works out to $44 per share, a 5.7 percent premium to the stock's closing price on Wednesday and 56 percent higher than shares were before the first offer in June.
In premarket trading, Southern Union shares gained $2.10, or 5.1 percent, to $43.70. Williams shares declined 18 cents to $28.61.
Dallas-based Energy Transfer Equity initially offered $33 per share for the company in mid-June. A week later, Williams offered $39 per share, or a total value of about $4.9 billion. Earlier this month, Energy Transfer Equity raised its bid to $5.1 billion.
As part of the latest offer, Williams said it's strengthened its deal to make it less prone to regulatory hurdles and quicker to close. It also said the cash deal is not subject to any financing conditions.
Williams is giving Southern Union less than a week to finalize the terms of the transaction; it wants to end those discussions by Tuesday.
Williams said Southern Union would complement its own business, create a network of nearly 30,000 miles of regulated pipelines and save $50 million a year for the combined companies.
Williams Cos., which is still on track to split up its exploration and production businesses by fall, is based in Tulsa, Okla.