Constellation to buy 5 Boston plants for $1.1B

August 09, 2010

(AP) — Constellation Energy will buy five power plants from Boston Generating for about $1.1 billion, the company said Monday.

The power plants — four natural gas fired plants and a fuel oil plant — generate about 2,950 megawatts in all. The purchase price works out to $372 per kilowatt.

The deal is expected to be worked out as part of Boston Generating's bankruptcy proceedings. The company took on large sums of debt which became unwieldy during the economic downturn, when industrial customers pared back on energy use.

If approved, Constellation's bid will be considered the price to be beat in an asset auction to be held later this year.

Constellation, a Baltimore utility, expects the deal to boost earnings next year at the current bid price. The company plans to finance the deal with a mix of cash and debt.

Constellation's financial advisers were Credit Suisse and UBS Investment Bank and its legal adviser was Winston & Strawn LLP.

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