JANA Partners Opposes Purchase of Rice Energy

JANA pushes EQT for ‘immediate breakup’ over Rice Energy deal

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JANA Partners disclosed a new 5.8% stake in EQT Corporation (EQT) in a regulatory filing that allows for activism.

Background

On June 19th, 2017, EQT Corporation (EQT) and Rice Energy (RICE) announce that they have entered into a definitive merger agreement under which EQT will acquire all of the outstanding shares of Rice common stock for total consideration of approximately $6.7B – consisting of 0.37 shares of EQT common stock and $5.30 in cash per share of Rice common stock.

Shares Undervalued

JANA says it acquired the shares because they believe the stock is “undervalued” and represents an “attractive investment opportunity.”

JANA added that it has “substantial experience analyzing and investing in the energy sector.”

JANA, with the assistance of others, intends to have discussions with EQT’s shareholders, board of directors and management regarding the voting against shareholder approval of the acquisition of Rice Energy (RICE) as well as pursuing an “immediate breakup” of the company into a separately traded E&P business and midstream business in order to realize the company’s “full value and potential strategic value.”

JANA also seeks to optimize EQT’s capital allocation and board structure.

It added, “JANA is also prepared, if necessary, to nominate individuals for election to the Issuer’s board of directors and to participate in the solicitation of proxies in support of such individuals, and has signed Nomination Agreements.”

JANA entered into nomination agreements with Edward Cohen and Daniel Herz.

Price Action

Shares of EQT Corporation are up 1% to $59.11 in Monday trading. Rice Energy (RICE) is down 6% to $25.09.

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The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

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