Jana Partners is trying to block an expensive merger between two energy companies.
The Barry Rosenstein-led activist hedge fund announced a 5.8 percent stake in Pittsburgh-based EQT Corporation on Monday, and is pushing the company to abandon its announced $6.7 billion acquisition of Rice Energy.
The hedge fund is hoping to get more shareholders on its side to vote against the deal, which was announced in June and is expected to close in the fourth quarter.
Jana had been purchasing EQT shares as early as April, encouraged by the company’s intentions to separate its pipeline operations from its main exploration and production business, a source told The Post.
But Jana was “blindsided” by EQT’s announcement on June 19 that it planned to acquire Rice Energy at a high price, pushing back its plans to separate its businesses, the source said.
Shareholders also didn’t seem to like Rice deal, as EQT’s stock fell 9 percent on the day the deal was announced.
Jana partnered with three other individual EQT investors to help block the Rice acquisition. Two of the investors — Jonathan Cohen of Hepco Capital Management and Daniel Herz of Atlas Energy Group — signed agreements with Jana to be nominated to be on EQT’s board should Jana decide to enter into a proxy fight at EQT’s 2018 meeting.
EQT said in a statement Monday that it “seeks to maintain an open dialogue with investors and respects their opinions and perspectives.”
EQT said it is still evaluating a possible separation of its businesses, noting that they are not fully valued in the market.
“With respect to the request to separate the production and midstream businesses, and as previously disclosed, EQT has acknowledged that there is a sum-of-the-parts discount and EQT management has committed to evaluating options and devising a plan to address this discount by the end of 2018,” the company said.
EQT shares closed Monday up 2 percent, at $59.75 — but remain down 8.6 percent this year. Rice Energy shares fell 3.6 percent, to $25.66.
Reps for Rice did not respond to requests to comment.