Exelon Corporation (NYSE:EXC) and Constellation Energy Group
(NYSE:CEG) today filed a brief with the Maryland Public Service
Commission (PSC) that increases the companies’ commitments related
to the proposed merger, which is currently under review by the PSC,
and offers an enhanced package of benefits, totaling a more than
$445 million investment in Maryland, projected to create more than
2,400 jobs in the state.
“We listened carefully to questions posed by the Commissioners
and input from interested parties, and we responded by enhancing
the already robust package of benefits that the merger will provide
to Maryland,” said Exelon President and COO Christopher M. Crane.
“We think we have brought forth a good package that will benefit
BGE customers, result in a stronger, better-protected BGE, and
provide an infusion of thousands of jobs and hundreds of millions
of dollars into the Maryland economy.”
In today’s filing, Exelon and Constellation committed to:
- Build 175 megawatts (MW) of new
generation in Maryland, including 55 MW of wind or solar capacity,
which would increase the state’s total renewable capacity by more
than 30 percent. The new generation projects will be built within
the state, for a total projected investment of between $220-280
million.
- Construct—not renovate—a brand-new
Constellation headquarters building in Baltimore, adding more than
1,100 jobs into Maryland’s economy through direct, indirect and
induced effects, for a total projected investment of $95-120
million.
- Allowing BGE to retain its capital in
lieu of paying dividends to Exelon through 2014 to ensure BGE can
continue to support its significant level of investment in key
customer and reliability-related initiatives.
- Ensuring a majority of BGE’s board of
directors reside or have a principal place of business in
Maryland.
- Enhancing ring-fencing by adding to
what is already the gold standard in the industry as well as
increased corporate governance measures.
The investment of more than $445 million in Maryland as a result
of the merger also consists of the previously announced $112
million from a $100 one-time rate credit for BGE residential
customers; $15 million for the Maryland PSC to use directly for the
benefit of BGE customers; and $4 million to support the EmPower
Maryland Energy Efficiency Act.
In addition, the companies have committed to maintain charitable
giving at an average level of $7 million per year for at least 10
years, for a total of $70 million.
In addition to the companies’ merger filing with the PSC, Exelon
and Constellation made other regulatory filings in support of their
proposed merger. On Aug. 3, the Public Utility Commission of Texas
approved the merger. Other regulatory approvals required include
the Federal Energy Regulatory Commission, the Nuclear Regulatory
Commission, the New York State Public Service Commission and the
Department of Justice. Shareholders of both companies
overwhelmingly approved the transaction on Nov. 17. Pending all
required approvals, Exelon and Constellation expect to complete
their merger in early 2012.
About Exelon
Exelon Corporation is one of the nation’s largest electric
utilities with more than $18 billion in annual revenues. The
company has one of the industry’s largest portfolios of electricity
generation capacity, with a nationwide reach and strong positions
in the Midwest and Mid-Atlantic. Exelon distributes electricity to
approximately 5.4 million customers in northern Illinois and
southeastern Pennsylvania and natural gas to approximately 490,000
customers in the Philadelphia area. Exelon is headquartered in
Chicago and trades on the NYSE under the ticker EXC.
About Constellation Energy
Constellation Energy is a leading competitive supplier of power,
natural gas and energy products and services for homes and
businesses across the continental United States. It owns a
diversified fleet of generating units, totaling approximately
12,000 megawatts of generating capacity, and is a leading advocate
for clean, environmentally sustainable energy sources, such as
solar power and nuclear energy.
The company delivers electricity and natural gas through the
Baltimore Gas and Electric Company (BGE), its regulated utility in
Central Maryland. A FORTUNE 500 company headquartered in Baltimore,
Constellation Energy had revenues of $14.3 billion in 2010. Learn
more online: www.constellation.com.
For the latest information about the Exelon-Constellation
merger, visit the merger website:
www.exelonconstellationmerger.com.
Cautionary Statements Regarding Forward-Looking
Information
Except for the historical information contained herein, certain
of the matters discussed in this communication constitute
“forward-looking statements” within the meaning of the Securities
Act of 1933 and the Securities Exchange Act of 1934, both as
amended by the Private Securities Litigation Reform Act of 1995.
Words such as “may,” “will,” “anticipate,” “estimate,” “expect,”
“project,” “intend,” “plan,” “believe,” “target,” “forecast,” and
words and terms of similar substance used in connection with any
discussion of future plans, actions, or events identify
forward-looking statements. These forward-looking statements
include, but are not limited to, statements regarding benefits of
the proposed merger of Exelon Corporation (Exelon) and
Constellation Energy Group, Inc. (Constellation), integration plans
and expected synergies, the expected timing of completion of the
transaction, anticipated future financial and operating performance
and results, including estimates for growth. These statements are
based on the current expectations of management of Exelon and
Constellation, as applicable. There are a number of risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements included in this communication
regarding the proposed merger. For example, (1) the companies
may be unable to obtain regulatory approvals required for the
merger, or required regulatory approvals may delay the merger or
result in the imposition of conditions that could have a material
adverse effect on the combined company or cause the companies to
abandon the merger; (2) conditions to the closing of the
merger may not be satisfied; (3) an unsolicited offer of
another company to acquire assets or capital stock of Exelon or
Constellation could interfere with the merger; (4) problems
may arise in successfully integrating the businesses of the
companies, which may result in the combined company not operating
as effectively and efficiently as expected; (5) the combined
company may be unable to achieve cost-cutting synergies or it may
take longer than expected to achieve those synergies; (6) the
merger may involve unexpected costs, unexpected liabilities or
unexpected delays, or the effects of purchase accounting may be
different from the companies’ expectations; (7) the credit
ratings of the combined company or its subsidiaries may be
different from what the companies expect; (8) the businesses
of the companies may suffer as a result of uncertainty surrounding
the merger; (9) the companies may not realize the values
expected to be obtained for properties expected or required to be
divested; (10) the industry may be subject to future
regulatory or legislative actions that could adversely affect the
companies; and (11) the companies may be adversely affected by
other economic, business, and/or competitive factors. Other unknown
or unpredictable factors could also have material adverse effects
on future results, performance or achievements of Exelon,
Constellation or the combined company. Discussions of some of these
other important factors and assumptions are contained in Exelon’s
and Constellation’s respective filings with the Securities and
Exchange Commission (SEC), and available at the SEC’s website at
www.sec.gov, including: (1) Exelon’s 2010 Annual Report on Form
10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7.
Management’s Discussion and Analysis of Financial Condition and
Results of Operations and (c) ITEM 8. Financial
Statements and Supplementary Data: Note 18; (2) Exelon’s Quarterly
Report on Form 10-Q for the quarterly period ended September 30,
2011 in (a) Part II, Other Information, ITEM 1A. Risk
Factors, (b) Part 1, Financial Information, ITEM 2.
Management’s Discussion and Analysis of Financial Condition and
Results of Operations and (c) Part I, Financial Information,
ITEM 1. Financial Statements: Note 13; (3) Constellation’s
2010 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b)
ITEM 7. Management’s Discussion and Analysis of Financial Condition
and Results of Operations and (c) ITEM 8. Financial Statements and
Supplementary Data: Note 12; and (4) Constellation’s Quarterly
Report on Form 10-Q for the quarterly period ended
September 30, 2011 in (a) Part II, Other Information,
ITEM 1A. Risk Factors and ITEM 5. Other Information,
(b) Part I, Financial Information, ITEM 2. Management’s
Discussion and Analysis of Financial Condition and Results of
Operations and (c) Part I, Financial Information, ITEM 1.
Financial Statements: Notes to Consolidated Financial Statements,
Commitments and Contingencies. These risks, as well as other risks
associated with the proposed merger, are more fully discussed in
the definitive joint proxy statement/prospectus included in the
Registration Statement on Form S-4 that Exelon filed with the SEC
and that the SEC declared effective on October 11, 2011 in
connection with the proposed merger. In light of these risks,
uncertainties, assumptions and factors, the forward-looking events
discussed in this communication may not occur. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this communication.
Neither Exelon nor Constellation undertake any obligation to
publicly release any revision to its forward-looking statements to
reflect events or circumstances after the date of this
communication.
Additional Information and Where to Find it
In connection with the proposed merger between Exelon and
Constellation, Exelon filed with the SEC a Registration Statement
on Form S-4 that included the definitive joint proxy
statement/prospectus. The Registration Statement was declared
effective by the SEC on October 11, 2011. Exelon and Constellation
mailed the definitive joint proxy statement/prospectus to their
respective security holders on or about October 12, 2011. WE URGE
INVESTORS AND SECURITY HOLDERS TO READ THE DEFINITIVE JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS FILED WITH
THE SEC, BECAUSE THEY CONTAIN IMPORTANT INFORMATION about Exelon,
Constellation and the proposed merger. Investors and security
holders may obtain copies of all documents filed with the SEC free
of charge at the SEC's website, www.sec.gov. In addition, a copy of
the definitive joint proxy statement/prospectus may be obtained
free of charge from Exelon Corporation, Investor Relations, 10
South Dearborn Street, P.O. Box 805398, Chicago, Illinois
60680-5398, or from Constellation Energy Group, Inc., Investor
Relations, 100 Constellation Way, Suite 600C, Baltimore, MD
21202.
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