Constellation Energy could cut a deal
Today a major nuclear energy deal could be cut involving Constellation Energy and France's EDF. Jeremy Hobson has the details.
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Steve Chiotakis: Word could come today on a major deal involving nuclear power. It is an electric story -- an international triangle involving a company that was once on-the-brink, a European suitor and Warren Buffett. Here's Marketplace's Jeremy Hobson.
Jeremy Hobson: A few months ago, Constellation Energy faced bankruptcy. It jumped at the chance to be bought by Berkshire subsidiary MidAmerican Energy for $4.7 billion.
But now, that fire sale price seems radioactive. France's EDF is offering to pay twice as much per share -- for half the company's nuclear operations.
George Van Horn: EDF had tried to do some deals with Constellation earlier, but they couldn't because of financial constraints as far as getting the funding in the credit markets.
George Van Horn is a senior analyst at the firm IBIS World. He says now, the going rate for Constellation is just too good for EDF to pass up.
Van Horn: Nuclear energy itself is just seen generally as much more favorable than it might have been five or 10 years ago.
If Constellation backs out of the deal with MidAmerican, that company will get about 10 percent of Constellation's shares and almost $600 million.
In New York, I'm Jeremy Hobson for Marketplace.
Chiotakis: We should let you know Constellation Energy is an underwriter of this program.
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