Williams Cos. and GIP Weigh Bid for Noble Midstream

(Bloomberg) -- The Williams Companies Inc. is working with investment firm Global Infrastructure Partners on a possible offer for Noble Energy Inc.'s midstream unit, according to people with knowledge of the matter.

The two firms are among groups that are in talks to take Noble Midstream Partners LP private, said the people, who asked not to be identified because they weren't authorized to speak publicly. An agreement hasn't been reached and either side could choose not to proceed with a transaction, the people said.

Representatives for Williams and Global Infrastructure Partners declined to comment. A Noble representative didn't immediately respond to requests for comments.

Noble Midstream's units rose 2.2% to $27.50 on Monday in New York trading, giving the Houston-based company a market value of about $1.1 billion. The units have fallen about 48% in the past year. Williams fell 4.9% to $23.78 for the worst daily performance in more than seven months.

Noble Midstream Chief Executive Officer Terry Gerhart said during a conference call with analysts Friday that a strategic review “remains a priority.”

Removing incentive distribution rights, which give the parent company an increasing share of cash flow, is “part of the consideration that Noble is going through on their strategic review,” Gerhart said.

Noble Midstream on Friday reported net income of $53 million on revenue of $158 million during the second quarter, an almost 20% increase in profit over the same period last year.

Pipeline Sales

A deal for the Noble unit would add to a series of divestitures involving of North American pipeline operations. TC Energy Corp. closed the sale this month of Columbia Midstream Group to UGI Energy Services LLC.

Several private equity firms are weighing bids for stakes in Western Midstream Partners LP, which is being sold by Occidental Petroleum Corp. as part of its acquisition of Anadarko Petroleum Corp., people familiar with that matter have said.

Noble Midstream, structured as a master limited partnership, owns pipelines in Colorado's Denver-Julesburg Basin and the Delaware Basin in West Texas and New Mexico, according to its website.

Williams, based in Tulsa, Oklahoma has has teamed up with private equity to buy assets. Last year, it partnered with KKR & Co. to acquire Discovery Midstream Partners LLC from buyout firm TPG.

--With assistance from Andres Guerra Luz.

To contact the reporters on this story: Kiel Porter in Chicago at kporter17@bloomberg.net;Gillian Tan in New York at gtan129@bloomberg.net;Rachel Adams-Heard in Houston at radamsheard@bloomberg.net

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