EQT Corporation and Range Resources Corporation said on Monday 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 dollars. Each outstanding Range share will be exchanged for 0.987 EQT shares, leaving EQT’s existing shareholders with about 73 percent of the combined company and Range shareholders with about 27 percent. Both boards approved the agreement unanimously.
The combined company will produce more than 9 billion cubic feet equivalent a day, hold more than 30 years of inventory across nearly 3 million net acres in Appalachia, and own more than 3,700 miles of midstream infrastructure, the companies said. EQT said the deal improves its unlevered free cash flow breakeven to less than 2 dollars per MMBtu, increases its natural gas liquids diversification, and is expected to deliver BBB quality credit metrics at closing. The companies put base annual synergies at 325 million dollars within two years across corporate, operations and commodities marketing, with a pathway to more than 600 million dollars longer term, and projected cumulative free cash flow of about 20 billion dollars over the next five years at recent strip pricing.
“This transaction brings together two of the highest-quality, longest-duration asset bases in North America and creates a company uniquely positioned for the next era of natural gas,” EQT President and CEO Toby Z. Rice said. Range President and CEO Dennis L. Degner said Range’s board unanimously determined the deal would enhance its shareholders’ ability to participate in a constructive long-term natural gas and NGL outlook.
Closing is expected during the first quarter of 2027, subject to regulatory approvals and clearances, approval by shareholders of both companies, and other customary conditions. Two Range representatives, including Degner, will join EQT’s board at closing, EQT’s management team will lead the combined company, and headquarters will remain in Canonsburg, Pennsylvania. Range is headquartered in Fort Worth, Texas, and both companies’ operations are focused in the Appalachian Basin. Citi and RBC Capital Markets advised EQT, with Kirkland & Ellis as legal counsel; Evercore was lead financial advisor to Range, J.P. Morgan Securities also advised it, and Gibson, Dunn & Crutcher is its legal counsel.
The two companies will hold a joint conference call at 8:00 a.m. ET on Monday and have cancelled their previously scheduled third quarter earnings calls on October 28. Both will still release third quarter results after the market close on October 27.