EQT to Acquire Range Resources in All-Stock Deal: Combined Enterprise Value Tops $50 Billion, Closing Expected in Q1 2027
EQT Corporation and Range Resources Corporation announced on October 26 in Canonsburg, Pennsylvania, and Fort Worth, Texas, that they have entered into a definitive merger agreement under which EQT will acquire Range in an all-stock transaction, creating a combined company with a pro forma enterprise value of more than $50 billion. The transaction is expected to close in the first quarter of 2027.
Under the agreement, each Range share will be exchanged for 0.987 EQT shares. EQT's existing shareholders are expected to own about 73% of the combined company and Range shareholders about 27%. Reuters calculated the equity value of the deal at about $12.83 billion based on Range's roughly 234 million shares outstanding, implying an offer price of $54.91 per share, about 20.6% above Range's closing price on Friday. Range shares rose about 10.1% in premarket trading on Monday, while EQT shares fell about 4.6%.
The companies said the combined business will produce more than 9 billion cubic feet of natural gas equivalent per day, hold nearly 3 million net acres and more than 30 years of inventory in the Appalachian Basin, and own more than 3,700 miles of midstream infrastructure, making it America's largest vertically integrated natural gas producer. The merger is expected to lower the company's unlevered free cash flow breakeven to below $2 per MMBtu, deliver $325 million of base annual synergies within two years with a pathway to more than $600 million long-term, and generate about $20 billion of cumulative free cash flow over the next five years at recent strip pricing.
EQT President and CEO Toby Z. Rice said the transaction brings together two of the highest-quality, longest-duration asset bases in North America and positions the combined company, the industry's lowest-cost producer, for the next era of natural gas. Range President and CEO Dennis Degner said Range's board unanimously determined the deal would enhance shareholders' ability to participate in a constructive long-term outlook for natural gas and natural gas liquids.
Upon closing, two Range representatives, including Degner, will join EQT's board, EQT's executive team will lead the combined company, and headquarters will remain in Canonsburg. The deal requires regulatory approvals and approval by both companies' shareholders. Citi and RBC Capital Markets advised EQT; Evercore and J.P. Morgan Securities advised Range. Both companies canceled their previously scheduled third-quarter earnings calls on October 28, while still reporting results after the market close on October 27. Reuters noted that growing natural gas demand from data centers has improved the outlook for U.S. producers and prompted them to pursue larger output and deeper drilling inventories.
Source: GSM · USA (original Chinese edition)
Photo: 图：宾夕法尼亚州 Marcellus 页岩气田的一座天然气钻塔（资料图）。照片：Ruhrfisch，CC BY-SA 4.0，经 Wikimedia Commons。Photo: A natural gas drilling tower in Pennsylvania's Marcellus Shale (file photo). Photo: Ruhrfisch, CC BY-SA 4.0, via Wikimedia Commons.
