(Reuters) - Corvex Management LP kicked off its anticipated proxy challenge to Energen Corp on Wednesday, with the activist investor nominating four candidates to the oil and gas producer’s board of directors as it pushes for a sale of the company.
The move by the hedge fund, which owns about 9.9 percent of Energen’s shares according to a statement, is the latest step in its campaign to force a sale which, it hopes, will bolster a stock price that has lagged its peers.
Energen’s own filing said that it was committed to acting in the best interest of the company and all its shareholders. It also estimated a 34 percent rise in its 2017 production.
Energen said Corvex had pushed a “singularly-focused agenda” to sell the company regardless of market conditions and the producer’s improving performance.
Activism in the U.S. oil and gas sector has increased as investors seek to boost the value of energy companies weighed down by slumping crude prices after a mid-2014 peak.
While a resurgence in oil prices since November has had a positive impact on most U.S. producers’ share prices, activists continue to announce challenges to firms perceived to be underperforming - including ones in the past week that target Antero Resources and Resolute Energy.
Energen’s share price of $52.23 is 6.1 percent below the $55.62 it traded at on May 30, the day before Corvex said publicly it wanted the Birmingham, Alabama-based company to sell itself.
The $5.5 billion fund run by Keith Meister said in September it would proceed with a plan to get Energen investors to vote on its proposals after the company sought court guidance on whether Corvex’s stake allowed it to call a special shareholder meeting under Alabama law.
The quartet nominated by Corvex on Wednesday includes Jonathan Cohen, the founder of Atlas Energy and Atlas Pipeline Partners, which were respectively sold to Chevron Corp in 2011 for $4.3 billion and Targa Resources Corp in 2015 for $7.7 billion, according to its statement.
No date has been set for Energen’s shareholder meeting.
Reporting by John Benny in Bengaluru and David French in New York; Editing by Richard Chang and Peter Cooney