(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
By Robert Cyran
NEW YORK, Oct 26 (Reuters Breakingviews) – EQT is buying local rival Range Resources to create a US leader. Cost savings won’t cover the 21% premium being paid, but boss Toby Rice sees more. Although Appalachian producers must export, data centers are spurring local demand, auguring higher production and, perhaps, prices.
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CONTEXT NEWS
EQT said on October 26 it agreed to buy rival natural gas producer Range Resources for nearly $13 billion in an all-stock deal. Range investors will receive 0.987 shares of EQT for each share held. That is a 21% premium to where Range’s stock closed on October 23, the last day of trading before the deal was announced. EQT investors will own 73% of the combined company.
The deal creates the largest US natural gas company, with 9 billion cubic feet equivalent of production per day, and more than 30 years of inventory.
(Editing by Jennifer Saba; Production by Maya Nandhini)