NEW YORK (TheStreet) -- Keith Meister, founder of hedge fund Corvex Management and activist investor, told CNBC's "Halftime Reoprt" on Monday afternoon that after resigning from Williams Cos.'s (WMB) - Get Report board, he is seeking to nominate 10 placeholder directors.
Meister and six other directors resigned from the board in late June because they questioned the abilities of Williams Cos. CEO Alan Armstrong and the six directors who stayed to assist him, he told CNBC's Kate Kelly.
"They're not the best draft picks to be on the board, and they got on by being very loyal and supportive of a CEO whose record has failed to meet expectations," he explained.
The 10 directors that Meister is seeking to place on the board will all be Corvex employees who will serve as placeholders until Corvex can find the best permanent independent directors to present to shareholders, he said.
The plan to nominate a slate of directors began after Williams Cos. reportedly took a "just say no approach" to an acquisition by pipeline competitor Enterprise Products Partners (EPD) last week, rather than engaging with the company to see if the proposal would create more value for investors, Meister said.
"The Enterprise news from last week is very concerning because many of the suspicions that I had, as well as my fellow directors when we resigned, are proving to be true," he explained.
After reports of the rejected Enterprise deal, Meister said he originally asked Williams Cos. to nominate seven independent directors to its board to offset the six remaining directors who were "blindly loyal" to the CEO, but the company refused to adopt this plan.
The lack of confidence in the CEO and board of Williams Cos. is a result of missed financial expectations over the past five years, failed mergers and acquisitions and bad safety history, Meister said.
"I just think when you intellectually line up the facts, the company needed change," he concluded.
Shares of Williams Cos. were lower in early-afternoon trading on Monday.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings team rates Williams Co.s as a Hold with a ratings score of C-. The primary factors that have impacted the team's rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks.
You can view the full analysis from the report here: WMB