EQT, Equitrans Midstream To Reunite, Forging Integrated Natural Gas Firm

Natural gas producer EQT (EQT) has agreed to buy former pipeline unit Equitrans Midstream (ETRN) for about $5.5 billion, The Wall Street Journal reported early Monday. EQT stock fell modestly while Equitrans Midstream jumped.

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EQT will pay 0.3504 share for each Equitrans share, worth $12.50 a share based on Friday’s prices. That would be a 12% premium to Equitrans stock’s closing price Friday.

Equitrans common stock will be exchanged for 0.3504 share of EQT stock, representing a value of $12.50 per Equitrans share. Equitrans shares closed Friday at $11.15. Pittsburgh-based EQT had a market value of roughly $16.5 billion.

The deal is expected to be officially announced later on Monday, according to The Wall Street Journal.

EQT is a natural gas producer in the Appalachian Basin. It spun off Equitrans, a midstream pipeline business, in 2018 at the urging of activist investor Jana Partners.

The combined, vertically integrated natural gas firm could reap economies of scale.

Equitrans had said earlier this year that it was working with advisers, citing unnamed suitors.

EQT stock fell 2% in early Monday trading. Shares have rebounded somewhat in the past few weeks with natural gas prices, which had plunged. Nat gas prices have rebounded as big producers, including EQT and Chesapeake Energy (CHK), curbed output.

Equitrans stock jumped 8.5% to 12.10 before the open. Shares had closed just above a flat-base buy point of 11.

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

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