NEW YORK (TheStreet) -- Shares of Hess Corp. (HES) are higher by 1.98% to $66.95 in pre-market trading on Thursday morning, after the crude oil and natural gas exploration and production company announced it has agreed to sell a 50% interest in its Bakken Midstream assets for $2.675 billion.
The company is selling the 50% interest in Bakken to Global Infrastructure Partners. The two companies are creating a premier midstream joint venture called Hess Infrastructure Partners.
The joint venture will incur $600 million of debt through a 5-year term loan A facility. Proceeds will be distributed equally to both partners with Hess receiving total after-tax cash proceeds net of $3 billion.
"This transaction delivers significant and immediate value to our shareholders. The joint venture with its strategically located assets will be one of the largest midstream operators in the Bakken," Hess CEO John Hess said in a statement.
"By capitalizing on the financial strength and midstream energy experience of Global Infrastructure Partners, the two joint venture will be in a strong position to fund future energy infrastructure investments and continue to grow its midstream business," Hess added.
Separately, TheStreet Ratings team rates HESS CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate HESS CORP (HES) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."