UPDATE:NRC OKs Constellation Nuclear License Transfer To EDF
October 09 2009 - 5:32PM
Dow Jones News
The U.S. Nuclear Regulatory Commission on Friday cleared the
transfer of operating licenses for Constellation Energy Group Inc.
(CEG) nuclear-power plants to the joint venture created by the
purchase of half the company's nuclear business by Electricite de
France SA (EDF.FR).
Completion of the $4.5 billion deal, struck in December, has
been delayed pending various regulatory approvals. Once completed,
EDF would own 49.99% of the nuclear business, with Baltimore-based
Constellation owning the remaining 50.01% through two intermediate
companies.
The NRC placed several conditions on the deal, including
requiring that at least half the board members of the nuclear
company, Constellation Energy Nuclear Group, be U.S. citizens. NRC
rules prohibit nuclear licenses from being owned, controlled or
dominated by a foreign individual or company. The nuclear unit's
chief executive, chief nuclear officer and chairman of the board
must also be U.S. citizens, the NRC said in a press release.
"EDF's investment in Constellation Energy's nuclear assets
represents a unique opportunity to deliver significant economic,
energy and environmental benefits to a broad array of stakeholders
and would be a powerful catalyst for new nuclear development in the
United States," EDF and Constellation executives said in a
statement. EDF and Constellation have plans to build new reactors
at the Calvert Cliffs nuclear power plant in Maryland.
Constellation agreed to the EDF deal in December, spurning an
offer from Warren Buffett's MidAmerican Energy Holdings Co. that
would have taken the company private. Baltimore-based Constellation
was facing the possibility of filing for bankruptcy protection.
The EDF deal is still awaiting approval from Maryland
regulators, who last week gave interveners in the case extra time
to file testimony. Constellation is appealing a Maryland Public
Service Commission decision that gives state regulators authority
to block the deal.
Maryland regulators are concerned that the deal would affect
Constellation's utility, Baltimore Gas & Electric.
The NRC's approval of the agreement with EDF was widely expected
and isn't likely to speed up the review process in Maryland, said
Angie Storozynski, an analyst with Macquarie Securities in New
York.
"Nobody was expecting delays with the NRC approval," Storozynski
said. "It was a given."
-By Mark Long and Christine Buurma, Dow Jones Newswires;
212-416-2145; mark.long@dowjones.com