May 31, 2017 / 1:48 PM / 6 months ago

Hedge fund Corvex urges Energen to consider selling itself

May 31 (Reuters) - Hedge fund Corvex Management LP, run by activist investor Keith Meister, reported a 5.5 percent stake in Energen Corp and called on the oil and gas producer to consider selling itself or merging with another company.

Energen’s shares were up 3.1 percent at $57.38 in early trading.

Corvex urged Energen to consider ways to maximize shareholder value, “including a review of the potential value delivered to shareholders through a change of control transaction given the recent wave of acquisitions in the Permian Basin.”

The Permian Basin of West Texas, the largest U.S. oil patch, has become a hotbed of M&A activity in the energy industry as a recovery in oil prices spurs firms to make strategic investments.

The hedge fund, which called Energen's shares "undervalued", has held discussions with the company, according to a regulatory filing on Wednesday. (

Up to Tuesday’s close of $55.62, Energen’s shares had gained about 17 percent over the past year, valuing the company at about $5.5 billion. The S&P 500 Oil & Gas Exploration & Production index has gained about 24 percent over the same period. (Reporting by Swetha Gopinath and Yashaswini Swamynathan in Bengaluru; Editing by Maju Samuel)

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