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Energen seeks court ruling on investor rights as funds push for sale

Energen seeks court ruling on investor rights as funds push for sale
From Reuters - September 12, 2017

NEW YORK (Reuters) - Energen Corp on Tuesday sought guidance from an Alabama court on the states shareholder rights laws which an activist investor had said it would use to force a sale of the U.S. oil and gas producer, a regulatory filing shows.

Corvex Management, a $5.5 billion hedge fund run by Keith Meister, has waged a public campaign since May aimed at making Energen put itself on the auction block to help bolster its lagging stock price, a position echoed by hedge fund Elliott Management.

Energens assets are concentrated in the Permian Basin in Texas and New Mexico, where valuations have soared in the last two years as investors seek acreage in the low-cost production area to offset low oil prices. However, Energen, which has a market value of $5.1 billion, has traded at a discount to its peers.

Energens management has said the Birmingham, Alabama-based company would follow its existing business plan.

Corvex said last month its 10.1 percent stake passed the threshold needed for shareholders of Alabama-domiciled firms to call a special shareholder meeting at which it would seek approval to expand the board to 15 members from nine, with all new directors being Corvex nominees.

In the filing, Energen disputed Corvexs stance on the special meeting under both Alabama law and its own articles of association, and said it had asked the Circuit Court of Jefferson County to adjudicate on the matter.

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