Exelon Makes Bid to Buy FirstEnergy's Retail Power Business for $140 Million -- Update

   By Micah Maidenberg

Exelon Corp.'s (EXC) retail and wholesale power supplier, Constellation, wants to buy FirstEnergy Solutions Corp.'s (FE) retail power business for $140 million in cash.

Chicago-based Exelon disclosed the purchase agreement in a securities filing Tuesday morning. Exelon said the deal would boost its footprint in Midwest and Mid-Atlantic states, where FirstEnergy Solutions has focused its business.

A spokeswoman for Constellation said the proposed deal would allow its business to serve about 900,000 additional customers in six states, bringing its customer base to more than 3 million retail and business customers.

FirstEnergy said later Tuesday that the sale would be "another important step" in its restructuring. FirstEnergy expects total cash proceeds of about $280 million, including the return of cash collateral and collection of retained net working capital.

In April, FirstEnergy Solutions entered chapter 11 bankruptcy proceedings in Ohio, as its coal and nuclear power plants were pressured by less expensive gas-fired and renewable energy sources.

The proposed deal is expected to close in the fourth quarter. To acquire the contracts, Exelon's Constellation must win an auction supervised by the U.S. Bankruptcy Court in Akron. The court must also approve the deal.

Exelon shares closed up 0.8% at $42.17 on Tuesday.

--Josh Beckerman contributed to this article.

Write to Micah Maidenberg at micah.maidenberg@wsj.com

(END) Dow Jones Newswires

July 10, 2018 18:03 ET (22:03 GMT)

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