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. (bit.ly/2qFNiaW)
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)