EQT to Buy Range Resources in $13B All-Stock Gas Deal

EQT will buy Range Resources in an all-stock deal that creates a US natural gas producer worth over $50 billion; Range shares jumped about 16% Monday.

Lead

What Are the Terms of the EQT-Range Deal?

The deal is structured as a pure share exchange with no cash component. EQT shareholders will own about 73% of the combined company and Range shareholders about 27%.

The combined company will be headquartered in Canonsburg, Pennsylvania. EQT chief executive Toby Rice will lead it. Range chief executive Dennis Degner and one additional Range director will join the EQT board. Closing is expected in the first quarter of 2027, subject to regulatory approvals and votes by both sets of shareholders.

What Does the Combined Company Look Like?

The merged group will produce more than 9 billion cubic feet equivalent of gas a day. It will hold close to 3 million net acres, more than 30 years of drilling inventory and over 3,700 miles of midstream pipeline. Both companies operate mainly in the Appalachian Basin, the country's largest gas-producing region.

EQT expects base annual synergies of $325 million within two years, rising to more than $600 million over the longer term. Those savings come from drilling efficiency, shared infrastructure and lower corporate costs. The company puts cumulative free cash flow at about $20 billion over five years at recent futures prices. It says unlevered free cash flow breaks even below $2 per million British thermal units.

Why Did Range and EQT Shares Move in Opposite Directions?

Range shares rose because shareholders receive a premium of about 20.6% to the last close, while EQT shares fell because an all-equity deal dilutes existing holders. EQT also dropped on volume of roughly 8.5 times its average in early trading, a pattern consistent with merger arbitrage. In that strategy, traders buy the target and short the acquirer's stock to lock in the spread between the two.

The EQT decline came on a day when the major US equity indexes posted modest gains. It also followed a retreat from a 52-week high of $68.24, amid softer natural gas prices.

Strategic Context

The deal follows a period of consolidation among US energy producers seeking scale, inventory depth and lower unit costs. For gas producers, scale offers leverage in a market where demand is expected to grow from liquefied natural gas exports and power generation tied to data centers. Both companies point to rising demand as the rationale for combining.

EQT's pipeline and gathering network is the feature that separates it from most peers. Adding Range's acreage lets the company route more volume through its own infrastructure. That lowers the cost of getting gas to market.

What Comes Next for the Merger?

The next steps are shareholder votes and regulatory review, with the Q1 2027 close the working target. Citi and RBC Capital Markets advised EQT, and Evercore and J.P. Morgan Securities advised Range. The exchange ratio is fixed, so the deal's headline value will move with EQT's share price until closing.

Outlook

The combination turns two of Appalachia's largest producers into a company with more than $50 billion of enterprise value and a clear cost target. Near-term trading is likely to be shaped by arbitrage flows and gas prices. Over the longer term, the outcome depends on delivery of the $325 million in synergies and on demand growth from LNG and power generation.