Deal Would Create Natural Gas Pipeline Giant : Energy: Williams seeks controlling stake in Transco for $3 billion. Wall Street has questions.

Williams Cos., a major operator of natural gas pipelines, said Monday that it will pay $3 billion for a controlling stake in Transco Energy Co., a deal that would create the nation’s biggest natural gas carrier.

Under the agreement, Williams would acquire up to 24.6 million shares, or 60%, of Transco’s common stock for $17.50 a share.

The purchase price is a 39% premium over Friday’s closing price for Transco’s common stock. On Monday, Transco shares jumped $3.625 to $16.25 on the New York Stock Exchange, while Williams’ sank $2.75 to $24.125.

Analysts said the transaction would create a natural gas carrier with 27,000 miles of pipeline crisscrossing the country. The company would transport 4 trillion British thermal units of gas each year, they said.

Wall Street traders said Williams’ stock fell because the companies, in a conference call, did not sufficiently spell out the reasons for the marriage.

Keith Bailey, president, chief executive and chairman of Williams, said the company will be able to more “fully describe the benefits” of the merger to shareholders once it has made regulatory filings concerning the tender offer.

The company said it is constrained from talking about the deal until that happens.

Bailey said the deal must be approved under U.S. antitrust laws and that approval is expected in January.

The companies said they have been in discussions about the merger for the past few weeks and that their boards approved the deal Sunday.

Transco’s properties include Transcontinental Gas Pipe Line Corp., which operates 10,500 miles of pipeline extending from the Gulf of Mexico through the South and along the Eastern Seaboard to New York City.

Its main customers are natural gas and electric utility companies in the East and Northeast.

The company also owns Texas Gas Transmission Corp., an Owensboro, Ky., operator of 6,100 miles of pipeline that runs from the Louisiana Gulf Coast up the Mississippi River Valley to Indiana and Ohio.

Williams owns Northwest Pipeline Corp., a 3,900-mile interstate natural gas pipeline system that serves the Pacific Northwest. It also owns Williams Natural Gas Co., a 6,200-mile natural gas pipeline that feeds the Midwest.

Tulsa, Okla.-based Williams also owns WilTel, a telecommunications firm that built a national fiber-optic network in the late 1980s.