The Center supported the sale of Constellation to Electricite de France (EdF) and opposed the sale to Warren Buffet's MidAmerican's Energy Holding Company. Constellation clearly listened to the Center's advice and called off the Buffet deal. Constellation reversed course and after they had initially accepted Warren Buffet's offer over EdF's. The Center knew the Buffet offer was a bad deal for Constellation and residents of Maryland and New York. EdF, the French state-controlled nuclear power company, and Constellation expect this deal to close in six to nine months. The Center supports the EdF - Constellation deal and will do everything in our power to assure its success. The Center's call on this deal should alert the entire American utility industry of our prowess in analyzing such deals.
Constellation Energy will sell half of its nuclear power business to EDF for $4.5 billion. Electricite de France is already Constellation Energy's largest shareholder and its offer for half of Constellation's nuclear business includes an immediate $1 billion cash infusion and an option for Constellation to sell up to $2 billion of non-nuclear generation assets to the French company in six to nine months. Constellation's nuclear business includes three nuclear power stations with five reactors in Maryland and New York. Nuclear power accounts for 61 percent of Constellation's total electricity generating capacity of 8,700 megawatts.
Constellation Energy will sell half of its nuclear power business to EDF for $4.5 billion. Electricite de France is already Constellation Energy's largest shareholder and its offer for half of Constellation's nuclear business includes an immediate $1 billion cash infusion and an option for Constellation to sell up to $2 billion of non-nuclear generation assets to the French company in six to nine months. Constellation's nuclear business includes three nuclear power stations with five reactors in Maryland and New York. Nuclear power accounts for 61 percent of Constellation's total electricity generating capacity of 8,700 megawatts.
Constellation will have to pay MidAmerican $593 million in cash -- including a $175 million termination fee -- and issue MidAmerican 20 million shares, or 9.9 percent of its stock. The preferred stock that MidAmerican bought with its $1 billion infusion will be converted into a loan with a 14 percent interest rate that will have to be repaid in a year. (The Baltimore Sun, 12/17/08)
Previous Center Posts on the Deal:
Dec 8, 2008: "Constellation Board Meeting On Electricite de France Offer"
Dec 4, 2008: "Electricite de France Wants Half of Constellation Nuclear Unit"
Oct 31, 2008: "Center Participates in Nuclear Regulatory Commission Meeting"
Oct 31, 2008: "Center Opposes Warren Buffet Purchase of Constellation"
Sept 29, 2008: "Plans For 3rd Nuclear Plant at Calvert Cliffs Probably Dead"
Oct 03, 2008: "Plans For 3rd Nuclear Plant at Calvert Cliffs Looking Better"
(The Washington Post article on this issue)
No comments:
Post a Comment