STOCK MARKET WATCH -- Wednesday, 26 August 2015

[Demeter]

2. D.C. rejects Exelon-Pepco merger; Del. terms blocked

http://www.delawareonline.com/story/news/local/2015/08/25/exelon-merger-blocked/32329217/

Millions in energy and utility concessions and Delmarva Power bill credits were thrown into limbo Tuesday by a District of Columbia regulator vote against the $6.8 billion Exelon-Pepco Holdings Inc. merger. D.C. Public Service Commission members rejected the plan after Delaware, New Jersey, Maryland and Virginia had already approved Exelon’s offer of $27.25 per share for Pepco’s stock, along with assumption of Pepco’s debt.

Full approval would have created the Mid-Atlantic’s largest electric and gas utility, with 10 million customers and a $26 billion rate base. Delmarva Power, part of Pepco, would have kept its headquarters in Delaware under the two big companies agreement with the state Public Service Commission...Delmarva has 305,000 Delaware electric customers, along with 126,000 Delmarva natural gas customers in New Castle County. Exelon and Pepco said in a joint statement that the companies would respond once they review their options...

“Everyone tried to secure what we thought was a fair settlement for the public,” Delaware Public Service Commission Executive Director Robert Howatt said. “I think at this point we’re kind of in a wait-and-see perspective. Wait and see what action, if any, Exelon will take.”

Delaware Public Advocate David Bonar, whose office supported the deal after Exelon agreed to improved concessions for Delaware, said this morning that “everybody else in the region is going to have to sit down and reassess their positions” as a result of the D.C. decision. “Or Exelon can fold their tent and go home,” Bonar added. “The ball is in Exelon’s court.”

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Pepco Holdings stock was down more than $3.90 per share shortly before 2 p.m., or about 14.5 percent. Exelon Corps stock was off $1.27, or about 3.9 percent at the same time.


I THINK THAT WAS AN EXCELLENT DECISION--BIGGER IS NOT BETTER.