Antero Midstream Announces Strategic $1.1 Billion Acquisition of Marcellus Shale Assets and Ohio Utica Divestiture

Rhea-AI Summary

Antero Midstream (NYSE: AM) entered a definitive agreement to acquire HG II Energy Midstream Holdings for $1.1 billion in cash, expected to close in Q2 2026, and to divest its Ohio Utica Shale assets for $400 million, expected to close in Q1 2026.

The acquisition is projected to be >15% accretive to Free Cash Flow after dividends, add ~900 MMcf/d throughput in 2026 and >400 undeveloped Marcellus locations. Transaction multiples: ~7.5x next‑3‑year average EBITDA (adjusted to 7.0x after >$100M capital avoidance synergies); Utica divestiture at >11x next‑3‑year average EBITDA with ~$35M annual EBITDA estimate. Financing sources include revolver liquidity, $700M committed financing, and asset sale proceeds.

Positive

• $1.1B Marcellus acquisition expected to close Q2 2026
• Projected >15% accretion to Free Cash Flow after dividends
• Adds ~900 MMcf/d throughput in 2026
• Acquisition includes >400 undeveloped Marcellus locations
• Identified >$100M discounted capital avoidance synergies lowering multiple to 7.0x
• $400M Utica divestiture at >11x EBITDA enhances balance sheet

Negative

• Acquisition and divestiture closings subject to customary regulatory approvals and timing risk
• Transaction relies on external financing including revolver and debt markets subject to market conditions
• Estimated Utica annual EBITDA (~$35M) indicates limited ongoing cash contribution from divested assets

Key Figures

Acquisition price $1.1 billion Cash acquisition of HG II Energy Midstream Holdings, LLC

Utica divestiture $400 million Cash proceeds for Ohio Utica Shale midstream assets

Throughput added 900 MMcf/d Expected additional throughput in 2026 from acquired assets

Undeveloped locations over 400 Undeveloped Marcellus locations dedicated to AM

Acquisition EBITDA multiple 7.5x Next three years average annual EBITDA, pre-synergies (non-GAAP)

Adjusted multiple 7.0x After over $100M discounted future capital avoidance synergies

Divestiture EBITDA multiple over 11x Next three years average annual EBITDA (non-GAAP) for Utica assets

EBITDA on divested assets $35 million Estimated average annual EBITDA over next three years

Market Reality Check

$36.75 Last Close

Volume Volume 2,184,844 shares is essentially in line with the 20-day average of 2,192,019. normal

Technical Price at $18.47 is trading above the 200-day moving average of $17.87 and about 6.8% below the 52-week high of $19.82.

Peers on Argus

While AM is up about 1.37%, key midstream peers like HESM, GLNG, DTM, KNTK, and PAA are modestly negative (e.g., GLNG down 1.34%). This points to a company-specific reaction tied to the announced acquisition/divestiture rather than a broad sector move.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Oct 08	Earnings call scheduling	Neutral	-2.7%	Antero Resources set Q3 2025 earnings release and conference call dates.
Oct 08	Dividend & buybacks	Positive	-2.7%	Declared Q3 2025 dividend and disclosed ongoing share repurchases and call timing.
Sep 08	Notes pricing	Neutral	+0.9%	Priced upsized <b>$650M</b> 5.75% senior notes due 2033 to refinance 2027 notes.
Sep 08	Debt offering launch	Neutral	-0.8%	Announced launch of <b>$500M</b> senior notes due 2033 to redeem 2027 notes.
Aug 14	Leadership changes	Neutral	-1.6%	Appointed Michael N. Kennedy as CEO and made broader board and CFO changes.

Pattern Detected

Recent news, including dividends, capital markets activity, and leadership changes, has often seen flat to slightly negative 1-day moves, even when shareholder-friendly or neutral in tone.

Recent Company History

Over the last several months, Antero Midstream has focused on balance sheet refinement, capital returns, and leadership transition. In Q3 2025, revenue rose to $294.8M with net income of $116.0M ($0.24 per share), while it issued and redeemed $650M tranches of 5.75% senior notes. The company maintained its $0.225 Q3 dividend and continued share repurchases. Leadership changes in August 2025 installed Michael N. Kennedy as CEO and Justin J. Agnew as CFO. Today’s large Marcellus acquisition and Utica divestiture build on that strategy by reshaping the asset base and future cash flow profile.

Market Pulse Summary

This announcement outlines a major portfolio reshaping, pairing a $1.1 billion Marcellus Shale midstream acquisition with a $400 million Utica divestiture. Management highlights immediate Free Cash Flow accretion, an added 900 MMcf/d of expected 2026 throughput, and over 400 new dedicated Marcellus locations. Recent filings show improving earnings and active debt management. Investors may watch closing timelines, integration of the acquired water and gathering systems, leverage metrics versus stated targets, and how non-GAAP measures like Adjusted EBITDA and Free Cash Flow trend post-transaction.

Key Terms

mmcf/d technical

"Expected to add approximately 900 MMcf/d of throughput in 2026"

mmcf/d stands for million cubic feet per day, a measure of how much natural gas is produced, transported or consumed each day. Investors watch it because daily gas flow directly affects a producer’s revenue potential and operational capacity—think of it like tracking how many gallons per day a factory fills: higher, steady flow usually means more sales and clearer forecasts, while drops or variability can signal problems or changing demand.

non-gaap financial measures financial

"Antero Midstream uses certain non-GAAP financial measures."

Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.

adjusted ebitda financial

"Antero Midstream defines Adjusted EBITDA as Net Income adjusted for certain items."

Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.

free cash flow financial

"Free Cash Flow after dividends is defined as Free Cash Flow before dividends less accrual-based dividends"

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

revolving credit facility financial

"expects to finance the transaction with borrowings under Antero Midstream's revolving credit facility"

A revolving credit facility is a type of loan that a business can borrow from whenever it needs money, up to a set limit. It’s like having a credit card for companies—allowing them to borrow, pay back, and borrow again as needed, providing flexibility for managing cash flow or funding short-term expenses.

AI-generated analysis. Not financial advice.

DENVER, Dec. 8, 2025 /PRNewswire/ -- Antero Midstream Corporation (NYSE: AM) ("Antero Midstream" or the "Company") today announced that it has entered into a definitive agreement to acquire HG II Energy Midstream Holdings, LLC ("HG Midstream") from HG Energy II, LLC ("HG Energy") for $1.1 billion in cash, subject to customary closing adjustments. The transaction is expected to close in the second quarter of 2026 and is subject to customary regulatory approvals. In addition, the Company announced that it has entered into a definitive agreement to divest its Ohio Utica Shale assets for $400 million in cash, subject to customary closing adjustments. This transaction is expected to close in the first quarter of 2026. The transactions were unanimously approved by the Company's Board of Directors.

Strategic Announcements Highlights and Rationale:

• Strategic bolt-on acquisition contiguous to Antero Midstream's assets in the core of the Marcellus Shale serving investment grade customer, Antero Resources
• Estimated to be immediately accretive to Free Cash Flow after dividends by over 15% (non-GAAP)
• Expected to add approximately 900 MMcf/d of throughput in 2026 and over 400 undeveloped Marcellus locations dedicated to AM
• Acquisition transaction multiple of approximately 7.5x next three years average annual EBITDA (non-GAAP)
• Identified over $100 million of discounted future capital avoidance synergies, resulting in an adjusted transaction multiple of 7.0x
• Divested Utica Shale assets at a transaction multiple over 11x next three years average annual EBITDA (non-GAAP)

Michael Kennedy, CEO and President of Antero Midstream said, "Today's strategic announcements further enhance the scale of Antero Midstream's asset base, solidifying it as a premier pure-play midstream company in North America's lowest cost basin. With the backbone of the gathering system already in operation, the acquired assets are highly capital efficient and complementary to our existing infrastructure portfolio. Importantly, this acquisition expands Antero Midstream's multi-decade dedicated inventory by another 5 years in the liquids core of the Marcellus Shale. In combination, today's strategic transactions high-grade our asset base from a reservoir quality, midstream capital efficiency, and Free Cash Flow trajectory standpoint creating significant shareholder value."

Justin Agnew, CFO of Antero Midstream, said "Antero Midstream's strong balance sheet and peer-leading leverage profile allow us to debt finance this acquisition while maintaining our credit profile and ratings. The significant Free Cash Flow on our legacy assets, over $100 million of expected asset level Free Cash Flow on the acquired assets, and attractive divestiture price allows us to meet our 3.0x leverage target almost immediately after closing the transactions. These credit enhancing, strategic transactions position us well for further debt reduction and additional return of capital to shareholders."

Marcellus Shale Acquisition Summary

Under the terms of the agreement, Antero Midstream will acquire all of the issued and outstanding equity interests in HG Midstream in an all cash transaction. In a separate press release, Antero Resources (NYSE: AR) announced the acquisition of all upstream assets of HG II Energy Production Holdings, LLC from HG Energy for $2.8 billion, subject to customary closing adjustments.

The assets consist of approximately 50 miles of gathering pipelines that have the ability to bi-directionally transport dry, lean, and liquids-rich natural gas under a fixed-fee agreement with Antero Resources. The acquired assets also include approximately 50 miles of water pipelines, above ground storage and associated water withdrawal points. Antero Midstream expects to integrate the acquired gathering pipelines immediately upon closing and integrate the water assets into its closed-loop fresh water and recycled water system throughout 2026.

The Company expects to finance the transaction with borrowings under Antero Midstream's revolving credit facility, proceeds from the Utica Shale divestiture, and/or debt capital markets transactions, subject to market conditions. Antero Midstream currently has approximately $900 million of liquidity under its revolving credit facility. Royal Bank of Canada and Wells Fargo Bank, N.A. have jointly provided $700 million of additional committed financing in connection with the transaction.

Utica Shale Divestiture Summary

Under the terms of a separate agreement, Antero Midstream will divest all of its gathering, compression, and water handling assets in the Ohio Utica Shale for $400 million. Antero Midstream has only three wells expected to be turned in line to its Utica Shale gathering system over the next several years and estimates that average annual EBITDA attributable to the divested assets under this development plan over the next three years is approximately $35 million. In a separate release, Antero Resources announced that it will divest all of its upstream assets in the Ohio Utica Shale for $800 million, subject to customary closing adjustments.

RBC Capital Markets served as financial advisor to Antero Midstream on the HG Midstream acquisition. Evercore served as financial advisor to the Antero Midstream Conflicts Committee. Vinson & Elkins L.L.P. served as legal counsel to Antero Midstream. Latham & Watkins LLP served as legal counsel to the Antero Midstream Conflicts Committee.

Jefferies LLC served as lead financial advisor to HG Energy and Quantum Capital Group. Wells Fargo and Truist served as financial advisors to HG Energy. Kirkland & Ellis served as legal counsel to HG Energy.

RBC Capital Markets served as lead financial advisor to Antero Midstream on the Utica asset divestiture. Wells Fargo also served as a financial advisor to Antero Midstream on the transaction. Vinson & Elkins L.L.P. served as legal counsel to Antero Midstream. 

Conference Call and Webcast Information

Antero Resources and Antero Midstream will hold a conference call to discuss the details of the transactions at 7:00 a.m. MT today, December 8, 2025. To participate in the call, dial in at 877-407-9079 (U.S.), or 201-493-6746 (International) and reference "Antero Midstream." A telephone replay of the call will be available until Monday, December 15, 2025 at 7:00 am MT at 877-660-6853 (U.S.) or 201-612-7415 (International) using the conference ID: 13757527. To access the live webcast and view the related call presentation, visit Antero Midstream's website at www.anteromidstream.com. A replay will be archived and available in the same location after the conclusion of the live event.

Non-GAAP Financial Measures and Definitions

Antero Midstream uses certain non-GAAP financial measures. Antero Midstream defines Adjusted Net Income as Net Income adjusted for certain items. Antero Midstream uses Adjusted Net Income to assess the operating performance of its assets. Antero Midstream defines Adjusted EBITDA as Net Income adjusted for certain items.

Antero Midstream uses Adjusted EBITDA to assess:

• the financial performance of Antero Midstream's assets, without regard to financing methods, capital structure or historical cost basis;
• its operating performance and return on capital as compared to other publicly traded companies in the midstream energy sector, without regard to financing or capital structure; and
• the viability of acquisitions and other capital expenditure projects.

Antero Midstream defines Free Cash Flow before dividends as Adjusted EBITDA less net interest expense, accrual-based capital expenditures, and current income tax expense. Capital expenditures include additions to gathering systems and facilities, additions to water handling systems, and investments in unconsolidated affiliates. Capital expenditures exclude acquisitions. Free Cash Flow after dividends is defined as Free Cash Flow before dividends less accrual-based dividends declared for the quarter. Antero Midstream uses Free Cash Flow before and after dividends as a performance metric to compare the cash generating performance of Antero Midstream from period to period.

Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow before and after dividends are non-GAAP financial measures. The GAAP measure most directly comparable to these measures is Net Income. Such non-GAAP financial measures should not be considered as alternatives to the GAAP measures of Net Income and cash flows provided by (used in) operating activities. The presentations of such measures are not made in accordance with GAAP and have important limitations as analytical tools because they include some, but not all, items that affect Net Income and cash flows provided by (used in) operating activities. You should not consider any or all such measures in isolation or as a substitute for analyses of results as reported under GAAP. Antero Midstream's definitions of such measures may not be comparable to similarly titled measures of other companies.

Antero Midstream Corporation is a Delaware corporation that owns, operates and develops midstream gathering, compression, processing and fractionation assets located in the Appalachian Basin, as well as integrated water assets that primarily service Antero Resources Corporation's (NYSE: AR) ("Antero Resources") properties.

This release includes "forward-looking statements." Words such as "may," "assume," "forecast," "position," "predict," "strategy," "expect," "intend," "plan," "estimate," "anticipate," "believe," "project," "budget," "potential," or "continue," and similar expressions are used to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Such forward-looking statements are subject to a number of risks and uncertainties, many of which are not under Antero Midstream's control. All statements, except for statements of historical fact, made in this release regarding activities, events or developments Antero Midstream expects, believes or anticipates will or may occur in the future, such as statements regarding our strategy, future operations, financial position, estimated revenues and losses, potential or pending acquisitions or other strategic transactions of Antero Midstream and Antero Resources, including the proposed acquisitions from HG Energy and the proposed Utica divestitures, the timing and financing thereof and Antero Resources and Antero Midstream's respective ability to achieve the intended operational, financial and strategic benefits from any such transactions, projected costs, prospects, plans and objectives of management, Antero Resources' expected production and development plan, natural gas, NGLs and oil prices, Antero Midstream's ability to realize the anticipated benefits of its investments in unconsolidated affiliates, Antero Midstream's ability to execute its share repurchase and dividend program, Antero Midstream's ability to execute its business strategy, impacts of geopolitical events, including the conflicts in Ukraine and in the Middle East, and world health events, information regarding long-term financial and operating outlooks for Antero Midstream and Antero Resources, information regarding Antero Resources' expected future growth and its ability to meet its drilling and development plan and the participation level of Antero Resources' drilling partner, the impact on demand for Antero Midstream's services as a result of incremental production by Antero Resources, the impact of recently enacted legislation, and expectations regarding the amount and timing of litigation awards are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are based on management's current beliefs, based on currently available information, as to the outcome and timing of future events. All forward-looking statements speak only as of the date of this release. Although Antero Midstream believes that the plans, intentions and expectations reflected in or suggested by the forward-looking statements are reasonable, there is no assurance that these plans, intentions or expectations will be achieved. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements. Except as required by law, Antero Midstream expressly disclaims any obligation to and does not intend to publicly update or revise any forward-looking statements.

Antero Midstream cautions you that these forward-looking statements are subject to all of the risks and uncertainties incidental to our business, most of which are difficult to predict and many of which are beyond Antero Midstream's control. These risks include, but are not limited to, risks associated with the acquisition of HG Energy and the disposition of assets in the Utica Basin, including the risk that the acquisition or disposition is not consummated on the terms expected or on the anticipated schedule, or at all, and risks associated with the successful integration and future performance of the acquired assets and operations, commodity price volatility, inflation, supply chain or other disruptions, environmental risks, Antero Resources' drilling and completion and other operating risks, regulatory changes or changes in law, the uncertainty inherent in projecting Antero Resources' future rates of production, cash flows and access to capital, the timing of development expenditures, impacts of world health events, cybersecurity risks, the state of markets for, and availability of, verified quality carbon offsets and the other risks described under the heading "Risk Factors" in Antero Midstream's Annual Report on Form 10-K for the year ended December 31, 2024.

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SOURCE Antero Midstream Corporation

FAQ

What did Antero Midstream (AM) announce on December 8, 2025?

Antero Midstream announced a definitive agreement to acquire HG Midstream for $1.1B and a separate agreement to divest Ohio Utica assets for $400M.

When are the AM transactions expected to close and what are the timelines?

The Utica divestiture is expected to close in Q1 2026 and the HG Midstream acquisition in Q2 2026, subject to regulatory approvals.

How will the HG Midstream acquisition affect Antero Midstream's cash flow and throughput?

The deal is expected to be >15% accretive to Free Cash Flow after dividends and add about 900 MMcf/d of throughput in 2026.

What valuation multiples did Antero Midstream report for the AM deals?

The acquisition trades at ~7.5x next‑three‑year average EBITDA, adjusted to 7.0x after >$100M synergies; the Utica divestiture was >11x EBITDA.

How does Antero Midstream plan to finance the $1.1B acquisition?

Planned financing includes borrowings under the revolver, proceeds from the Utica sale, and/or debt capital markets; RBC and Wells Fargo committed $700M financing.

What is the estimated EBITDA contribution of the divested Utica assets for AM?

Antero Midstream estimates average annual EBITDA from the divested Utica assets of about $35M over the next three years.