UPDATE 2-Regulators OK EDF-Constellation deal -- with terms - News

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UPDATE 2-Regulators OK EDF-Constellation deal -- with terms

By: AFX | 30 Oct 2009 | 02:28 PM ET

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By Michael Erman NEW YORK, Oct 30 (Reuters) - Maryland utility regulators on Friday approved Constellation Energy Group Inc's sale of a stake in its nuclear unit to Electricite de France SA , provided the companies comply with several conditions. The conditions include a $110.5 million rate credit to Baltimore utility customers. Among the other conditions that Maryland's Public Service Commission imposed were requiring Constellation to make a $250 million cash capital infusion into its Baltimore Gas and Electric utility unit and protecting Baltimore Gas should Constellation run into fiscal problems. Constellation agreed in December to sell nearly half its nuclear power business to EDF for $4.5 billion. The deal broke up a previously agreed upon takeover of Constellation by Warren Buffett's MidAmerican Energy Holdings, which rescued the company from a liquidity crisis last September. The PSC ruled that a new nuclear power plant the companies propose to build is too contingent to be regarded as providing benefits to the utility's rate payers, making the rate credit necessary. It said the $110.5 million rate credit would come out to about $100 per Baltimore Gas customer and should be given by the end of March. Constellation and EDF had hoped to avoid the PSC approval process, but the regulators ruled in June that Constellation needed their blessing before going forward with the sale. The commission asked the companies to inform it by Nov. 6 whether they plan to complete the transaction. Constellation and EDF said they were reviewing the commission's order. Constellation also reported its third quarter earnings on Friday, posting net income of $137.6 million versus a loss of $225.7 million a year earlier. The company's shares were up 33 cents, or 1.1 percent, at $31.46 on the New York Stock Exchange in afternoon trading. (Reporting by Michael Erman, editing by Leslie Gevirtz and Gerald E.

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