DALLAS - Energy Transfer Equity is buying pipeline operator The Williams Companies for approximately $32.61 billion.

The companies said Monday that the combination creates one of the five biggest energy companies in the world.  

Energy Transfer Equity LP will pay $43.50 per share, a 4.6 percent premium to Williams' Friday closing price of $41.60. Williams' shareholders can choose either shares of Energy Transfer Equity affiliate Energy Transfer Corporation, cash or a combination of both.  

“Williams’ intense focus on connecting the best natural gas supplies to the best natural gas markets will be a significant complement to the ETE family of diverse energy infrastructure. As a combined company, we will have enhanced prospects for growth, be better able to connect our customers to more diverse markets, and have more stability in an environment of low commodity prices. Importantly, Williams Partners will retain its current name and remain a publicly traded partnership headquartered in Tulsa, Oklahoma,” said Alan Armstrong, President and Chief Executive Officer of Williams. 

The companies put the deal's value at about $37.7 billion, including debt and other liabilities. Williams' stockholders will also receive a one-time special dividend of 10 cents per share that will be paid immediately before the acquisition closes.  

Both companies' boards approved the deal, which is expected to close in the first half of 2016.

The Associated Press contributed to this report.