Chicago-based energy company Exelon Corp. has offered to buy its competitor, NRG Energy, for $6.2 billion in a deal which would create a national energy giant worth about $60 billion.
In a letter delivered on Oct. 19 to NRG President and chief executive officer David Crane and Chairman Howard Cosgrove, Exelon proposed to acquire all of NRG's outstanding common stock in an all-stock transaction.
"We believe a combination of Exelon and NRG would represent an exceptional value for shareholders of both companies," John Rowe, chairman and CEO of Exelon, said in a statement.
"This combination would not only diversify Exelon's generation portfolio geographically, it would also create immediate earnings and cash flow accretion."
He added that an Exelon-NRG combination would result in an enterprise that would generate capacity of around 47,000 megawatts, or enough electricity to serve nearly 45 million homes.
Exelon is one of the nation's largest electric utilities with nearly $19 billion in annual revenues.
The company, which has 17,800 employees, has one of the industry's largest portfolios of electricity generation capacity, with a nationwide reach and strong positions in the Midwest and Mid-Atlantic, said company officials.
Exelon distributes electricity to approximately 5.4 million customers in northern Illinois and Pennsylvania and natural gas to 480,000 customers in the Philadelphia area.
Copyright Agence France-Presse, 2008
