More Background on Investors Encouraging EQT to Sell Itself
Last week MDN told you about a kerfuffle that erupted yesterday when Chapter IV Investors, a Charlotte, NC-based investment firm with investments in EQT, Range Resources and Antero Resources, announced it had sent a letter to EQT urging the company to consider merging with either Range Resources or Antero Resources (see EQT Urged by Major Investor to Merge with Either Range or Antero). As we told you, Chapter IV is essentially two investors, W. Barnes Hauptfuhrer, Managing Partner and Portfolio Manager, and Ryan J. Jack, Partner. We said at the time, “we don’t detect any kind of bullying on the part of Chapter IV, like that of a raider Carl Icahn (successful takeover of Chesapeake Energy & Cheniere Energy) or Keith “Mini-Me” Meister (unsuccessful attempt to takeover Williams). Rather, it appears to be a couple of investors who believe there is an honest and good case for a combination of EQT with another company.” We now have more evidence that our gut instinct was right–from an article Bloomberg published…
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A kerfuffle erupted yesterday when Chapter IV Investors, a Charlotte, NC-based investment firm with investments in EQT, Range Resources and Antero Resources, announced it had sent a letter to EQT urging the company to consider merging with either Range Resources or Antero Resources. Chapter IV, which is essentially two big-money investors (W. Barnes Hauptfuhrer, Managing Partner and Portfolio Manager, and Ryan J. Jack, Partner), does not own enough stock in any of the companies (less than 1% in each) to throw its weight around like a corporate raider. Rather, it appears to be two investors attempting to grab the attention of these companies and their shareholders by issuing a press release (full copy below) with a plan they say would create a new Marcellus/Utica driller worth more than $25 billion. Obviously the value of investments for Chapter IV would go up under such a scenario–so there is self-interest at work here. However, we don’t detect any kind of bullying on the part of Chapter IV, like that of a raider Carl Icahn (successful takeover of Chesapeake Energy & Cheniere Energy) or Keith “Mini-Me” Meister (unsuccessful attempt to takeover Williams). Rather, it appears to be a couple of investors who believe there is an honest and good case for a combination of EQT with another company, and were willing to spend $500 on a press release to make their case. Are they right?…
Seventy Seven Energy (SSE) is the former Chesapeake Oilfield Operating company, the oilfield services subsidiary of Chesapeake Energy that Chessy spun out into its own company in July 2014 after it couldn’t find anyone to buy it (see 
Extreme Plastics Plus (EPP) has been manufacturing and installing well pad liners since 2007. Pad liners protect the ground from accidental spills of frack wastewater and chemicals used during the drilling process. Located in Fairmont, WV, EPP’s customers are in the Marcellus and Utica Shale region. In order to expand, EPP raised an undisclosed amount of investment money from Hastings Equity Partners in 2013 (see 
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Word has leaked out that WGL Holdings, the umbrella company that owns Washington (DC) Gas Light Company and WGL Midstream, is considering selling itself to utility giant (and Spanish-based) Iberdrola. The deal, if it happens, has implications for the Marcellus. Earlier this month MDN reported that WGL Midstream, which already is a 7% owner in the Mountain Valley Pipeline project, had upped its ownership stake to 10% (see 
In May, U.S.-based oilfield services company FMC Technologies announced they will merge with their much larger quasi-competitor, France-based Technip, in an all-stock deal that will create a new company called TechnipFMC worth $13 billion (see 
Not even a year go–in December of last year–one of the biggest and brightest stars in the midstream firmament for the Marcellus/Utica, MarkWest Energy, sold itself to Marathon Petroleum (see 
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Yesterday EQT announced a pair of deals that will net the company another 60,000 Marcellus/Utica acres including 44 Marcellus wells producing a collective 44 million cubic feet equivalent per day (MMcfe/d) of natural gas. Most of the acreage (42,600) is in three West Virginia counties, with another 17,000 acres in three Pennsylvania counties. EQT is paying a total of $683 million for the two deals. In the first deal, EQT is buying Trans Energy, Inc., which will become a wholly-owned subsidiary of EQT. EQT is also buying Trans Energy joint venture partner Republic Energy’s share in their Marcellus jv. The land is located in Marion, Wetzel and Marshall counties (WV). In the second deal, EQT is buying 17,000 acres from an unidentified third party in southwestern PA, in Washington, Westmoreland and Greene counties. EQT describes the purchases as adding acreage to their “core development area.” You may recall that EQT closed a deal in July, just three months ago, to purchase 62,500 acres from Statoil in WV for $407 million (see 
Just two months ago Rice Energy announced they are buying competitor Vantage Energy for $2.7 billion (see