Hess Midstream Partners LP began its initial public offering of 12,500,000 common units March 27, with units expected to be priced between $19 and $21, part of a bid to capitalize on growing Bakken Shale production and pursue acquisitions of complementary midstream assets.
The partnership owns interests in North Dakota assets, including a natural gas gathering and compression system and a crude oil gathering system, a natural gas processing and fractionation plant, a crude oil pipeline, crude oil and natural gas loading and receipt terminals, and 550 crude oil rail cars, according to SEC filings. Hess Midstream also detailed expansion plans to focus on meeting the infrastructure needs for increasing Hess Corp. Bakken production and growth through acquisitions from the partnership's sponsors, as well as third parties.
Hess Midstream applied for listing on the New York Stock Exchange under the symbol HESM, and the units being offered to the public make up a roughly 22.5% limited partner interest in the partnership, with a 30-day option for the underwriters to purchase an additional 1,875,000 common units at the IPO price that would increase the interest to 25.8%. Hess Corp. subsidiaries and Global Infrastructure Partners II and its affiliates will own the remaining limited partner interest in Hess Midstream, while Hess Infrastructure Partners LP will own all equity interests in the partnership's general partner and all of the partnership's incentive distribution rights.
The book-running managers for the IPO are Goldman Sachs & Co., Morgan Stanley, Citigroup, J.P. Morgan, MUFG and Wells Fargo Securities, with Barclays, HSBC, ING Financial Markets, Scotia Howard Weil, SMBC Nikko and TD Securities acting as co-managers.