Exelon urges NRG Energy shareholders to tender shares in its exchange offer

By Lisa Kerner

Charlotte, N.C., Nov. 25 - Exelon Corp. accused NRG Energy, Inc. of standing in the way of opportunity by refusing to discuss the merits of Exelon's exchange offer.

John Rowe, Exelon chairman and chief executive officer, urged NRG shareholders to tender their shares in the offer to send a "clear message that they want NRG to enter into a definitive agreement to create a company that will deliver substantial value for its investors."

Exelon is offering a fixed exchange ratio of 0.485 shares of Exelon common stock for each NRG share.

The offer expires at 5 p.m. ET on Jan. 6, according to an Exelon news release.

Exelon believes a negotiated business combination can be structured in a way to reduce refinancing requirements to $4 billion or less and that it can secure committed financing.

On Monday, NRG's board of directors unanimously rejected Exelon's unsolicited proposal and recommended that NRG shareholders not tender their shares in the offer.

The board noted that the exchange ratio is the same as in Exelon's original Oct. 19 offer, which the board also rejected.

It was previously reported that in addition to launching an unsolicited exchange offer for the outstanding shares of NRG, Exelon or its subsidiary, Exelon Xchange Corp., planned to propose expanding the Princeton, N.J.-based power company's 11-member board to up to 15 members and filling the resulting vacancies with Exelon nominees.

Exelon, a Chicago-based electric company, also filed a lawsuit in the Delaware Chancery Court against NRG and its directors alleging a breach of fiduciary duty by NRG's directors for reasons including the failure of the NRG directors to give appropriate consideration to, and take appropriate action on, the Oct. 19 proposal from Exelon.

J.P. Morgan joined Exelon's team of financial advisers for the proposed acquisition. The team also includes Barclays Capital Inc., Lazard Freres & Co. LLC, Loop Capital Markets, LLC, RBS Securities Corp., and UBS Securities LLC.

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