Monday, December 15, 2008

Constellation Energy is ready to rock

Constellation Energy (CEG 27.13) has a $26.50 takeover offer on the table by Warren Buffet's Mid-American unit, which at $4.7 billion wouldn't even replace one of their nuclear reactors.

So EDF, the French utility, hemmed and hawed about making a bid with private equity firm KKR, but Kravis treated the joint proposal as if it would be another marriage, and we all know how his trophy wifes have worked out, so EDF walked down the aisle themselves.

Now CEG is favoring their bid of $4.5 billion for half of the company. It's just contingent on bank waivers and could be announced this week!

So Buffett will take a $600 million going away present, a 10% stake in CEG, and a billion dollar note paying 14%.

Showing that the avuncular grandfather, is as tough with companies as he is with his adopted granddaughter Nicole!

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