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'Back to business' for Williams, unless another suitor comes knocking

Having surviveda takeover attempt that it legally has to pretend it , can go back totending its big pile of knitting, analysts said, as long as somebody else doesnot target it for M&A again.

"Williams can breathe a sigh of relief that it's over,and they can go back to business as usual," Jake Dollarhide of Longbow AssetManagement — based in Williams' Tulsa, Okla., home — said in an interview. "[]is still pumping gas into New York City, and Williams has a chance to continue."

Dollarhide said the next task for Williams will be theimmersion of Williams Partners LPback into the corporate structure, a move that by 's $37.7billion offer in September 2015. Dollarhide said absorbing the master limitedpartnership will act as a "poison pill" deterring any follow-on bidsby another would-be acquirer.

Jay Hatfield, portfolio manager for the actively managedInfraCap MLP exchange-traded fund, said July 6 that Williams might still be onsomebody's target list.

In Transco, Williams has the most attractive energy asset inthe U.S., running from New York to Houston and covering most consumption andproduction regions with lots of expansion opportunities, Hatfield said.

"You'd think it would be a takeout candidate, but mostpeople are too capital constrained to buy them," Hatfield said. Exceptionsto that rule include raiders such as Carl Icahn and Warren Buffett.

Business as usual for Williams includes a large order bookof 16 expansion projects listed on its website, projects as small and simple asthe New York Bay Expansion, which is 0.2 mile of pipe replacement withhorsepower improvements to deliver 115,000 Dth/d more gas to New York City, andas large as the Constitutionpipeline, which is 124 miles of new pipe moving 650,000 Dth/d north out ofPennsylvania's Marcellus Shale to interconnects in New York for markets farthernorth.

"Williams has a lot of expansion opportunities,"Hatfield said. "What's bad in the downturn is good in the upturn."

He sees this year as a bottom for Williams, which he said isundervalued by 40%. He expects U.S. onshore oil and gas production to increasethrough 2019, replacing declines in international and offshore production, withWilliams in the catbird seat to take advantage of more volume, particularlyfrom the Appalachian shales to premium Northeast and Southeast markets.

Hatfield's ETF has 6.36% of its holdings invested inWilliams stock and 11.2% in Williams Partners units, its second-largestinvestment. The ETF's top holding is Energy Transfer Partners, the MLP of ETE.

"One caveat," Hatfield said. "The dividendcut overhangs on the stock."

In what many saw as a move to pressure shareholders intomaking a pro forma vote in favor of the ETE merger to improve Williams' chanceof getting damages in a breakup, Williams' board that it might chop thecompany's healthy 64-cent quarterly dividend if the deal did not go through.

Hatfield says he is ready for a small cut in the dividend, "butnot a [Kinder Morgan Inc.]80%, stupid kind of cut."

In December 2015, Kinder Morgan its dividend 75% to avoid takingon more debt or issuing stock.

While Williams isstill in court in Delaware, ostensibly to force ETE to consummatethe aborted merger or get a judge to assign some monetary damages to Williamsfor ETE's change of heart, a dividend cut is expected to help Williams pay forall the pipeline expansion projects and its own breakup payment in the scuttledWilliams Partners roll-up.

Happy with a "business as usual" aftermath are thepolitical and economic powers that be in Tulsa, a town greatly affected byWilliams' presence and its charitable and cultural contributions. "Tulsa'srelieved." Dollarhide said. "This has saved Tulsa, saved Oklahoma."