Buffett outbid for nuclear plants

By Greg Keller ASSOCIATED PRESS | Thursday, December 4, 2008

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PARIS

France's state-controlled power company challenged a proposed takeover by Warren Buffett of Constellation Energy on Wednesday, putting up almost as much money for half its nuclear business as the legendary investor had offered for the entire company.

Constellation shareholders have already filed at least half a dozen lawsuits, saying the $4.7 billion bid from Mr. Buffett's MidAmerican Energy Holdings Co. was too low. MidAmerican swept in to acquire the company three months ago as Constellation wrestled with frozen credit markets and tried to stay afloat.

Constellation's business includes three nuclear power stations with five reactors located in Maryland and New York. Nuclear power accounts for 61 percent of Constellation's total electricity generating capacity of 8,700 megawatts.

Constellation's non-nuclear assets include coal- and natural-gas-fired electric plants, as well as oil and renewable energies such as solar, geothermal and hydro power.

Constellation shares jumped 19 percent, or $4.74, to $29.89 at the open of trade with Mr. Buffett's offer now threatened.

Electricite de France SA, Constellation's biggest shareholder, offered $4.5 billion for just half of the U.S. wholesale power generator's nuclear business early Wednesday. EDF withdrew its own bid of $35 per share in October for all of Constellation, and called MidAmerican's offer inadequate.

EDF, which owns 9.5 percent of Constellation, said the offer values the company at about $52 per share and that the price represents a 96 percent premium to the rival offer for all of Constellation. MidAmerican's offer values the company at about $26.50 per share.

"EDF expects it can receive the necessary regulatory approvals for the acquisition of its interest in the nuclear generation and operation business and close the transaction within six to nine months, upon Constellation's termination of its proposed transaction with MidAmerican Energy," the company said Wednesday.

Constellation said it was reviewing the offer.

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