Carl Icahn (Trades, Portfolio), CEO of Icahn Enterprises, increased his stake in Energen Corp. (EGN, Financial) on Monday, roughly a month after announcing he may acquire the oil and gas producer and then walking back the statement in an interview.
The transaction boosted Icahn’s holding of the company to 3,225,706 shares, or 3.3%, from 3 million shares, or 3.06%, at his previous filing on June 20.
He started the position in May with a purchase of 2 million shares from his business partner in the deal, Keith Meister of Corvex, and holds options to purchase another 2 million shares.
Energen shares climbed 4.91% Tuesday to $68.60, while the S&P 500 closed 0.22% higher for the day. Energen shares rallied 43% in the past 12 months.
Icahn said in an interview with CNBC in May that he believed Energen was worth “well over” $100 per share. The activist investor also indicated in filing that he might purchase the company but qualified the statement in an interview.
“We could buy this company … however, I don’t presume to think I’m the right buyer for it because there’s such synergies for another company,” Icahn said.
Icahn compared Energen to RSP Permian, which Concho Resources (CXO, Financial) purchased in March and produced synergies of $2 billion.
“What we do at IEP, we like to buy things relatively cheaply where companies are undervalued. One of the major reasons is, to say it bluntly, is the board isn’t doing what I consider to be their job, which is to let shareholders decide if it should be sold, not them.”
Energen operates primarily in the Permian Basin of west Texas and New Mexico and has a $6.7 billion market cap. In the first quarter, it reported revenue of $356.17 million, an increase from $240.92 million the same quarter a year earlier. Net income totaled $118.9 million, up from $33.4 million.
The company attributed the growth to higher production and commodity prices. It brought in 92.9 million barrels of oil equivalent per day, exceeding its guidance midpoint by 4%.
Icahn’s holding company, Icahn Enterprises, owns one other energy producer, CVR Energy (CVI), which operates petroleum refining and fertilizer products businesses.
Icahn Capital Management, the investment arm of Icahn Enterprises, also owns stakes of about 13% each in SandRidge Energy Inc. (SD, Financial) and Cheniere Energy Inc. (LNG, Financial).
See Carl Icahn (Trades, Portfolio)'s portfolio here.
