8-KMaterial AgreementsSecurities & ListingExhibits & Filings

EQT Corp 8-K Report, Material Agreement (May 7, 2021)

Filed May 7, 2021For Securities:EQT

Summary

EQT Corporation (EQT) announced on May 7, 2021, that it entered into a Membership Interest Purchase Agreement to acquire substantially all of the assets of Alta Resources Development, LLC. This strategic acquisition involves a total consideration of $1.0 billion in cash and approximately $1.925 billion worth of EQT common stock, based on the volume-weighted average price over the preceding 30 trading days. The transaction is expected to significantly expand EQT's scale and operational footprint, particularly in the Marcellus Shale region. The deal is subject to customary closing conditions, including EQT shareholder approval for the stock issuance and regulatory approvals such as the Hart-Scott-Rodino Act review. EQT has secured a $1.0 billion bridge loan commitment and intends to finance the acquisition through a combination of cash on hand, existing credit facilities, potential debt capital markets transactions, and the bridge loan if necessary. This move signals EQT's commitment to consolidating its position and driving growth in the natural gas sector.

Key Highlights

  • 1EQT Corp entered into a definitive agreement to acquire substantially all assets of Alta Resources Development, LLC for a total consideration of $1 billion cash and $1.925 billion in EQT common stock.
  • 2The transaction is expected to enhance EQT's scale and operational footprint, particularly in the Marcellus Shale.
  • 3Closing of the transaction is contingent upon EQT shareholder approval of the stock issuance and customary regulatory approvals, including HSR Act clearance.
  • 4EQT has secured a $1.0 billion bridge loan commitment and plans to use a mix of existing cash, credit facilities, and potential debt offerings to fund the acquisition.
  • 5The agreement includes customary representations, warranties, and covenants for both parties.
  • 6Upon termination under certain conditions, EQT may be required to pay a termination fee of $146.25 million or $21.94 million, depending on the circumstances.
  • 7EQT shareholders will vote on the stock issuance required to complete the transaction, with further details to be provided in a forthcoming proxy statement.

Frequently Asked Questions

The total consideration for the acquisition is comprised of $1.0 billion in cash and approximately $1.925 billion in EQT Corporation's common stock, based on the volume-weighted average sales price of the stock for the thirty trading days ending on May 5, 2021.

The primary conditions for closing include the approval of EQT's shareholders for the issuance of the stock consideration, the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, and the satisfaction of other customary closing conditions such as the accuracy of representations and warranties and compliance with covenants by both parties.

EQT intends to finance the transaction and related fees and expenses using a combination of cash on hand, borrowings under its revolving credit facility, potential debt capital markets transactions (subject to market conditions), and, if necessary, borrowings under a $1.0 billion unsecured bridge loan facility committed by Bank of America, N.A. and JPMorgan Chase Bank, N.A.

Yes, EQT may be obligated to pay a termination fee of $146,250,000 to the seller under certain termination circumstances, such as a change in EQT's board recommendation or material breach of the agreement. A smaller termination fee of $21,937,500 may be payable if EQT shareholders fail to approve the stock issuance, under specific conditions.