Constellation Energy is sold

The Baltimore region's long loss of corporate headquarters hit a new milestone in 2012: All Fortune 500 companies operating here are based elsewhere. That was one consequence of Chicago’s Exelon purchasing Baltimore’s Constellation Energy Group in March for $7.9 billion.

For Constellation's CEO, it was a third-time's-the-charm deal.

Mayo A. Shattuck III brokered a merger with the parent of Florida Power & Light in 2005, but the transaction was called off the next year amid ire over a big spike in electricity rates. Next, Constellation almost sold itself to billionaire investor Warren Buffett during the 2008 financial crisis, when the company teetered on the brink of collapse. Then came Exelon.

Constellation made news right to the end. The day the merger closed, the company disclosed that it had agreed to a $245 million settlement with federal regulators over allegations that it intended to manipulate energy markets with trades in 2007 and 2008 — which Constellation disputed.

The merger gave Baltimore Gas and Electric Co.'s residential customers a $100 credit on their bills and provided organizations with funds for efforts to more permanently reduce costs for low-income residents and other consumers.

It brought job reductions, too. Exelon eliminated about 170 Maryland positions through layoffs and buyouts, though it also moved some jobs into the state from Pennsylvania. None of the cuts hit BGE, spared for at least two years by the terms of the acquisition agreement.

Exelon's current order of business in Baltimore — besides planning a new office tower — is convincing regulators that BGE customers should pay higher rates next year. Customers will get their say at hearings in January, which could bring irritated reminders that some went without power for eight days — during a heat wave — after the surprise derecho storm hit in late June.

Jerry Jackson, Baltimore Sun
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