New Issue: Williams sells upsized $800 million seven-year notes to yield 8 5/8%

By Paul A. Harris

St. Louis, June 5 - Williams Cos. priced an upsized offering of $800 million senior notes due June 1, 2010 (B3/B+/B+) at par Thursday to yield 8 5/8%, according to a syndicate source.

The deal was increased from $500 million. Price talk was for a yield of 8 5/8%-8 7/8%.

Lehman Brothers, Citigroup, JP Morgan and Banc of America Securities were joint bookrunners on the off-the-shelf deal.

The co-managers were ABN Amro, Merrill Lynch & Co., Scotia Capital, Bank of Oklahoma, Morgan Stanley, TD Securities, Credit Lyonnais and Royal Bank of Scotland.

Proceeds will be used for general corporate purposes and payment of maturing debt obligations, including partial repayment of the company's 9¼% senior unsecured notes due March 2004.

Williams is a Tulsa, Okla.-based natural gas company.

Issuer:	Williams Cos.
Amount:	$800 million (increased from $500 million)
Maturity:	June 1, 2010
Security description:	Senior notes
Bookrunners:	Lehman Brothers, Citigroup, JP Morgan, Banc of America Securities (joint)
Co-managers:	ABN Amro, Merrill Lynch, Scotia Capital, Bank of Oklahoma, Morgan Stanley, TD Securities, Credit Lyonnais, Royal Bank of Scotland
Coupon:	8 5/8%
Price:	Par
Yield:	8 5/8%
Spread:	573 basis points
Call features:	Make-whole call until June 1, 2007, then callable at 104.313, 102.156, declining to par on June 1, 2009 and thereafter
Equity clawback:	Until June 1, 2006 for 35% at 108.625
Settlement date:	June 10, 2003
Ratings:	Moody's: B3
	Standard & Poor's: B+
	Fitch: B+
Price talk:	8 5/8%-8 7/8%

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