Natural gas producer EQT Corp. has signed an agreement to buy back its former unit Equitrans Midstream in a roughly $5.5 billion all-stock deal, The Wall Street Journal reported on March 11.
The combined company is expected to be valued at more than $35 billion, including debt, the report said.
The deal is expected to be announced later on March 11, the report said, citing people familiar with the matter.
Both the companies did not immediately respond to a Reuters request for comment.
Shares of Equitrans jumped more than 8% in premarket trading, while EQT was down about 1%.
The deal comes at a time when U.S. natural gas producers are curbing their output and spending on drilling activity as an oversupplied market has brought the prices of the commodity down to multi-decade lows.
The transaction closely follows rival Chesapeake Energy's $7.4 billion bid for Southwestern Energy in January.
In 2018, EQT split into two, separating its midstream operations from the gas production business.
The largest U.S. natural gas producer has operations focused in the cores of the Marcellus and Utica shales in the Appalachian Basin.
Recommended Reading
Chesapeake-Southwestern Deal Delayed Amid Feds Scrutiny of E&P M&A
2024-04-05 - The Federal Trade Commission asked Chesapeake and Southwestern for more information about their $7.4 billion merger — triggering an automatic 30-day waiting period as the agency intensifies scrutiny of E&P deals.
EQT, Equitrans Midstream to Combine in $5.5B Deal: Reports
2024-03-11 - EQT Corp.'s deal would reunite the natural gas E&P with Equitrans Midstream after the two companies separated in 2018.
EQT, Equitrans to Merge in $5.45B Deal, Continuing Industry Consolidation
2024-03-11 - The deal reunites Equitrans Midstream Corp. with EQT in an all-stock deal that pays a roughly 12% premium for the infrastructure company.
Making Bank: Top 10 Oil and Gas Dealmakers in North America
2024-02-29 - MergerLinks ranks the key dealmakers behind the U.S. biggest M&A transactions of 2023.
Ohio Oil, Appalachia Gas Plays Ripe for Consolidation
2024-04-09 - With buyers “starved” for top-tier natural gas assets, Appalachia could become a dealmaking hotspot in the coming years. Operators, analysts and investors are also closely watching what comes out of the ground in the Ohio Utica oil fairway.