M&A

On Monday, Rice Energy was merged into EQT, creating the largest onshore natural gas producing company these United States (see Out with the Old: Rice Energy Sign Comes Down Day of EQT Merger). The $8.2 billion deal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). There was plenty of drama along the way to the deal getting done–primarily opposition by evil corporate raider Jana Partners, in collusion with Atlas Energy (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Jana was fresh off from helping Amazon take over the Whole Foods grocery store chain. Yet somehow EQT was able to vanquish Jana’s efforts to stop the merger. How did EQT do it? We went behind the curtain yesterday to share EQT’s winning strategy in defeating Jana (see EQT’s 4-Pronged Strategy for Defeating Corp Raider Jana in Rice Deal). They way corporate raiders work, as we’ve explained many times before, is to buy enough stock in a company to get a board seat, then agitate in the board room, forcing the company to layoff people and sell assets–all in a bid to make the stock price pop so the raider can sell their shares at a handsome profit and move on to the next victim. Disgusting organizations. Since Jana lost face and reputation by not stopping the EQT/Rice merger, they’ve decided to slink away, back into the darkness. We spotted a story that says Jana has already sold a portion of their EQT stock–and they continue shop more of it. They’ve thrown in the towel on EQT and will now go pick on someone else to destroy…
Read More “Corp Raider Slinks Away After Losing EQT Fight; Selling Stock”

On Monday, Rice Energy was merged into EQT, creating the largest onshore natural gas producing company these United States (see Out with the Old: Rice Energy Sign Comes Down Day of EQT Merger). The $8.2 billion deal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). There was plenty of drama along the way–primarily opposition to the deal by evil corporate raider Jana Partners, in collusion with Atlas Energy (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Another corporate raider, D.E. Shaw, piled on too, but at least they supported the deal to merger Rice into EQT (see Under Pressure, EQT Moves Up Timeline to Explore Splitting Co.). You know we loathe corporate raiders. They buy enough stock in a company to get a board seat, then agitate, forcing the company to layoff people and sell assets–all in a bid to make the stock price pop so they can sell their shares at a handsome profit and move on to the next victim. Disgusting organizations and disgusting people. Jana was the primary opponent to the EQT/Rice deal. Jana was fresh off from helping Amazon take over the Whole Foods grocery store chain. Yet somehow EQT was able to fend off Jana’s efforts against their company. How did they do it? That was the subject of a recent post on the Seeking Alpha investor’s website. Here’s a fascinating look at the strategy EQT used to fend off an evil corporate raider…
Read More “EQT’s 4-Pronged Strategy for Defeating Corp Raider Jana in Rice Deal”

Yesterday the Marcellus/Utica experienced a fracking earthquake of historic proportions. That is, a fracking earthquake metaphorically speaking. Yesterday Rice Energy was merged into EQT, creating the largest onshore natural gas producing company in these United States. The $8.2 billion deal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). There was plenty of drama along the way–primarily opposition to the deal by evil corporate raider Jana Partners, in collusion with Atlas Energy (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Shame on both of them. Fortunately their effort to stop the deal didn’t gain traction. Yesterday was the day when the two companies became one. Two Rice Energy board members, Dan Rice IV and Bobby Vagt, joined the EQT board. Another two independent (outside either firm) board members were also added–Thomas Karam, founder and Chairman of Karbon Partners, and Norman Szydlowski, former president and CEO of SemGroup Corporation. Standing by the virtual water cooler, MDN has overheard that many Rice personnel were nervous about what yesterday would bring. You know the routine: Two rooms–one for those staying, and one for those getting the heave-ho. Everyone waiting to get “the call” to whichever room they’re assigned. We’ve been there. It sucks. But that’s the reality in today’s corporate world. One thing we found interesting is that the huge Rice Energy sign on the company’s (former) HQ building was taken down yesterday–the very day the two merged. An MDN friend caught some of it on a smartphone video (below). EQT isn’t wasting any time making a statement: In with the new, out with the old…
Read More “Out with the Old: Rice Energy Sign Comes Down Day of EQT Merger”

Next Monday the largest natural gas-producing company in the these United States will be born–from the merger of EQT and Rice Energy, based in Pittsburgh. Yesterday the shareholders for both EQT and Rice voted to approve the merger/deal by overwhelming majorities. The megadeal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). Evil corporate raider Jana Partners tried to stop the deal–but failed, as they acknowledged earlier this week (see Corp Raider Jana Partners Admits Defeat Ahead of EQT/Rice Vote). Next Monday the transaction will be complete and the new EQT will produce more natural gas in the Lower 48 States than Chesapeake Energy, the current reigning champ. Some 84% of the EQT shareholders who voted, voted to approve the deal, and 74% of voting Rice shareholders voted in favor of the deal. What happens next? After the consummation of the merger on Monday, EQT CEO Steve Schlotterbeck said the company will immediately appoint a committee to look into…splitting the company. Yes, you read that right. Not splitting it back into EQT and Rice, but splitting it into upstream (drilling) and midstream (pipelines). Two companies will become one and then become two again. Go figure. A recommendation and decision about whether to proceed with a split will happen, according to Schlotterbeck, by “the end of the first quarter 2018.” There’s little doubt the decision will be “yes” on a split…
Read More “EQT/Rice Shareholders Make it Official – Merger Happens Nov 13”

The guy who runs the investment firm Jana Partners, Barry Rosenstein, is a corporate raider. He invests millions in a company he’s targeted in order to get one or two people elected to the board of directors. Those people then agitate and force the company to lay off hundreds or thousands of employees, and sell off assets, in a bid to make the stock price jump. When the price does jump, corporate raiders like Rosenstein then sell their shares, making a profit on the new/higher price (buy low sell high). It may be legal, but we consider it immoral. In June, EQT, one of the biggest drillers in the Marcellus/Utica, announced a deal to buyout and merge in Rice Energy, another sizable M-U driller (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). A few weeks later Jana targeted EQT in an attempt to stop the deal (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Jana believes it could make a whole lot more money if the deal doesn’t go through, and instead if EQT splits itself in two–one half a drilling company, the other half a pipeline company (firing a bunch of people along the way). So Jana went on a smear campaign, making all sorts of wild accusations against EQT, including calling EQT management’s compensation structure “perverse,” and accusing the company of using “deceptive” maps of EQT and Rice acreage positions (see Corp Raider Continues to Trash Talk EQT/Rice Merger, Vote Set Nov 9). All the trash-talking and bullying didn’t worked. The deal will happen–this week–and Jana is now officially throwing in the towel. They will still vote against the deal with their shares, but they have withdrawn their proxy fight to enlist enough other shares to vote down the deal…
Read More “Corp Raider Jana Partners Admits Defeat Ahead of EQT/Rice Vote”

The disgusting corporate raiders at Jana Partners are fighting to the bitter end in their attempt to stop the merger/takeover of Rice Energy by EQT. In June EQT and Rice Energy announced that EQT will buy out and merge in Rice Energy, to create (in EQT) the largest natural gas-producing company in the United States (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). A few weeks later, so-called “activist investor” (i.e. corporate raider) Jana Partners, in league with the Cohen family (Atlas Energy) started a proxy fight to block EQT’s takover/merger with Rice (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Jana is the same company that recently helped Amazon in its hostile takeover of grocery company Whole Foods. Unfortunately (for Jana), their strategy isn’t working this time around. Over the past few weeks Jana has sent a couple of nasty letters to EQT’s board, making some rather wild claims. The tone of Jana’s communication is becoming more shrill as time goes on, as desperation sets in and a vote by EQT shareholders on the deal draws near (Nov. 9). The problem is the financial press picks up on these wild claims and repeats them, so yesterday EQT felt it necessary to (once again) respond and set the record straight–to debunk the lies Jana is spreading about the deal and about EQT’s past performance…
Read More “Corp Raider Continues to Trash Talk EQT/Rice Merger, Vote Set Nov 9”

On Wednesday, EQT announced the company has floated $3 billion (yikes!) of IOUs–called “notes” in the financial industry–with various due dates and interest rates payable, in order to make a cash payment due as part of their purchase of Rice Energy. The total deal is worth $8.2 billion, with EQT paying $6.7 billion and assuming Rice’s existing debt of $1.5 billion (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). This deal is moving ahead, over the objections of two different corporate raiders who own a considerable amount of EQT stock (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal and Under Pressure, EQT Moves Up Timeline to Explore Splitting Co.). In addition to raising $3 billion in cash from IOUs, EQT is also tapping into its line of credit and the money it has socked away in its checking account to get this deal done…
Read More “EQT Raises $3B in IOUs as Down Payment for Rice Energy Purchase”