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Constellation, Exelon make two acquisitions

Prospective partners Constellation Energy Group Inc. and Exelon Corp. are looking to grow the family, as the companies made separate deals on Thursday to buy a power plant and a natural gas and electricity supplier.

Constellation, which is being acquired by Chicago-based Exelon, announced it is buying MXenergy, a Connecticut-based supplier of natural gas and electricity, for $175 million.

Exelon said it is buying Wolf Hollow, a natural gas-fired power plant in north Texas, from Sequent Wolf Hollow LLC, for $305 million.

Exelon agreed in April to buy Constellation in an estimated $7.9 billion all-stock deal that is scheduled to close in the first quarter of 2012. The merger agreement allows for the companies to make other acquisitions independent of each other until the deal closes.

Wolf Hollow will give Exelon 720 megawatts of electricity for the Electric Reliability Council of Texas power market. Exelon already owns and operates three other natural gas-fired power plants.

Constellation’s deal will give it access to deregulated power markets in 15 states and two Canadian provinces where MXenergy supplies gas and electric to more than 540,000 residential and small commercial customers.

Mark Huston, Constellation’s head of retail business, said in a statement that the acquisition complements the company’s growing retail business, particularly in the residential market “at a time when customers are choosing energy suppliers in significant numbers.”

MXenergy provides services in California, Texas, Florida, Georgia, Michigan, Illinois, Indiana, Ohio, Kentucky, Pennsylvania, New Jersey, New York, Connecticut and Massachusetts. MXenergy is registered as an electric and natural gas supplier in Maryland.

Huston said the acquisition positions Constellation to exceed 1 million mass market customers by the end of the year.

MXenergy has more than 200 employees and is headquartered in Stamford, Conn., with an operational office in Houston and a call center in Annapolis Junction.

The deal is expected to close in the third quarter, subject to required federal and state regulatory approvals as well as approval by MXenergy shareholders.

MXenergy said it has been reviewing options since December. The company has an exclusive agreement to buy gas and electric from RBS Sempra Commodities, a venture between the Royal Bank of Scotland and Sempra Energy. RBS Sempra said it was looking to sell off the entity that provides MXenergy with natural gas and electricity, according to a December filing with the Securities and Exchange Commission.

In a February 2011 SEC filing, MXenergy reported earnings of $25.7 million for the quarter ending Dec. 31, 2010. This compared to $18.2 million for the corresponding period in 2009.

Daily Record reporter Rachel Bernstein contributed to this story.