NEW YORK (TheStreet) -- Shares of Energen Corp (EGN) were sliding, lower by 4.34% to $70.51 on heavy volume in late morning trading Wednesday, after the company filed to sell shares of common stock and a Citigroup downgrade.
The company announced that it has priced an underwritten public offering of 5.7 million shares of its common stock. Total gross proceeds of the offering will be roughly $405 million.
The underwriter has a 30-day option to buy an additional 855,000 shares from Energen.
The company expects the offering to close on or about June 22.
Energen intends to use the net proceeds from the offering to pay for a slight increase in drilling activity in the Midland Basin in the second half of 2015 and a multi-year acceleration of development activities in the Permian Basin in 2016.
Credit Suisse is acting as sole book-running manager for the offering.
Also, analysts at Citigroup downgraded shares of Energen to "neutral" from "buy" this morning.
The firm cut its price target to $78 from $80, saying near-term upside looks priced in at current valuation levels.
About 2.55 million shares have changed hands as of 11:19 a.m. ET today, compared to its average trading volume of about 900,118 shares a day.
Birmingham, Ala.-based Energen is an oil and gas exploration and production company with about 1.1 billion barrels of oil-equivalent proved, probable and possible reserves.
It also has 2.2 billion barrels of oil-equivalent contingent resources.
Separately, TheStreet Ratings team rates ENERGEN CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation: