EQT Closes $5.45B Acquisition of Equitrans Midstream

Appalachia E&P EQT Corp. has closed an all-stock deal to buy and Equitrans Midstream Corp. for roughly $5.45 billion.

Post transaction, EQT aims to swiftly vertically integrate Equitrans' midstream assets, the most notable of which is the Mountain Valley Pipeline.

EQT said the combined company is projected to have an unlevered NYMEX free cash flow breakeven price of approximately $2.00/ MMBtu, “which is at the low end of the North American cost curve and ensures robust free cash flow generation through all parts of the commodity cycle,” EQT said in a July 22 press release.

EQT additionally has identified more than $425 million of annual synergies associated with the combination that could drive EQT's long-term free cash flow breakeven price down even further, EQT said.

EQT will sacrifice some free cash flow to pay off Equitrans’ debt of between $7.6 billion and $8 billion. EQT will also sell assets to reduce borrowings. Including equity and debt, the deal is valued at roughly $13 billion. EQT has said it sees a clear path to $5 billion in divestitures and began a divestiture program in April with an asset swap with Equinor in the Appalachian Basin.