Constellation Energy Receives Unsolicited Proposal From Électricité de France

Constellation Energy confirmed that it has received an unsolicited proposal from Électricité de France (EDF). The main components of EDF’s proposal are:

* EDF would purchase a 50% ownership interest in the nuclear generation and operation business of Constellation Energy (excluding Constellation Energy’s existing interest in the UniStar joint venture) for $4.5 billion, subject to certain adjustments;
* EDF would make an immediate $1 billion cash investment in Constellation Energy in the form of nonconvertible cumulative preferred stock, which subsequently would be credited against the $4.5 billion purchase price (with EDF surrendering the preferred stock to Constellation Energy as partial payment); and
* EDF would provide Constellation Energy with additional liquidity by entering into an asset put option pursuant to which Constellation Energy could, at its option, prior to EDF’s acquisition of the 50% interest in Constellation Energy’s nuclear generation and operation business, sell to EDF non-nuclear generation assets having an aggregate value of up to $2 billion.

Constellation Energy said its Board of Directors will review the multi-faceted proposal, which includes proposed transaction documents and additional materials addressing regulatory and governance issues, as soon as practicable in a manner consistent with its fiduciary responsibilities to shareholders, as well as its responsibilities under its definitive merger agreement with MidAmerican Energy Holdings Company.

Constellation Energy’s Board of Directors has not withdrawn, modified or qualified its recommendation that shareholders of Constellation Energy vote in favor of the merger with MidAmerican. The special meeting of shareholders to vote on the merger with MidAmerican remains scheduled for 8:00 a.m. on December 23, 2008.