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Morning Brief: JANA Renews Pressure on EQT

JANA, which owns nearly 6 percent of EQT Corp.’s shares, is becoming impatient with the oil and gas company’s board.

JANA Partners’ Barry Rosenstein is once again turning up the heat on EQT Corp. In a September 20 letter sent to the energy company’s board of directors, the activist investor criticized EQT’s announcement last week that it would convene a committee of independent directors to address its sum-of-the-parts discount after its controversial acquisition of Rice Energy. “There is no conceivable justification for the board to drag its feet this long to even start its work and no excuse for asking shareholders to keep waiting for the company to finally take the only logical step to resolve its persistent sum of the parts discount,” Rosenstein says in the letter.

EQT is JANA’s largest long position in common stock. The hedge fund, which owns nearly 6 percent of the oil and natural gas company’s shares, openly opposed in July EQT’s planned acquisition of Rice and threatened a proxy fight. Rosenstein also has been calling for the company to split in two. In its latest letter, JANA reminds the board: “Given EQT’s shifting and easily-disproven arguments for the Rice acquisition, the board’s long-running failure to take aggressive action to address its undervaluation, and the governance issues we have identified, we also continue to believe that it may be necessary to bring in new directors who have made substantial investments in EQT stock and will do a better job pursuing maximum value creation.”

Last week, The D. E. Shaw Group said it owned about 4 percent of EQT and has a plan to unlock $8 billion of value by June 30, 2018. In a letter to EQT’s board, D.E. Shaw said its plan allows EQT to acquire Rice “and to deliver substantial value to shareholders.” Specifically, it calls on the company to separate its production and midstream businesses, restructure its midstream businesses through a merger with Rice, and appoint experienced midstream executives to the board.


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Melvin Capital Management sold about 400 million shares of Laureate Education, reducing its stake in the for-profit university to 5.3 percent, according to a regulatory filing. The investment is passive.


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