NEW YORK (TheStreet) -- Williams Partners (WPZ) shares are up 21.48% to $57.71 on heavy volume trading on Wednesday after its parent company Williams Companies (WMB) announced plans to purchase its subsidiary in an all stock deal valued at about $13.8 billion.
The energy infrastructure company reported that the acquisition will add $5.4 billion in earnings to its balance sheet in 2016.
"We continue to see an expanding portfolio of projects to connect the best supplies of natural gas and natural gas products to the best markets. The lower cost of capital and improved tax benefits expected from this transaction increase our confidence in extending the duration of our expected 10 percent to 15 percent dividend growth rate through 2020," said CEO Alan Armstrong.
The deal is expected to close in the third quarter this year with the company forecasting annual dividend growth between 10% and 15% through 2020. The company also announced a 6.7% increase in its third quarter dividend payout to 64 cents per share.
Williams Companies shares are up 4.8% to $52.50 in trading today.
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