Electricite de France & Constellation End Nuclear Partnership

Electricité de France SA (EdF) and Constellation Energy Group Inc. have agreed to end a joint venture to develop nuclear power plants together. The agreement allows EdF to continue pursuing the construction of a new reactor in Maryland and at Nine Mile Point and R.E. Ginna in New York. In exchange, Constellation Energy will receive $250 million in cash and stock. EDF's nearly 50% ownership stake in Constellation's existing nuclear power plants will not change.

The deal eliminates a contentious requirement under which EDF is required to buy 12 power plants— most of them coal-fired—from Constellation for as much as $2 billion. Under the deal, EDF will acquire Constellation's 50% ownership in UniStar for $140 million. EDF will transfer 3.5 million shares—valued at $110 million—it holds in Constellation to the Baltimore company. That will cut EDF's holdings in Constellation to an estimated 13.5 million shares, and EDF will no longer hold a seat on Constellation's board. (WSJ, 10/27/2010)