BALTIMORE, MD - Constellation Energy (NYSE: CEG), a leading competitive energy provider, today announced it has signed a definitive agreement to acquire 100 percent of MXenergy, a Connecticut-based supplier of natural gas and electricity with more than half a million customers in North America.
The proposed transaction to purchase MXenergy for $175 million, subject to normal adjustments, broadens Constellation Energy's mass market presence to include the 15 states and two Canadian provinces where MXenergy supplies gas and electricity to more than 540,000 residential and small commercial customers.
"MXenergy provides us with a broad platform that supplements our growing retail business, particularly in the residential market, at a time when customers are choosing energy suppliers in significant numbers," said Mark Huston, head of Constellation Energy's retail business.
"By combining forces with Constellation, we strengthen our ability to provide customers with quality service and innovative products that can help them manage their energy needs," said Jeffrey Mayer, president and chief executive officer of MXenergy.
MXenergy has more than 200 employees and is headquartered in Stamford, Conn., with a major operational office in Houston, Texas, and call-center operations in Annapolis Junction, Md.
Huston said the acquisition positions Constellation Energy to exceed 1 million mass market customers by the end of 2011. Constellation Energy has been steadily growing its residential base the past year by offering electric choice to residential customers in Maryland, Washington, D.C. and parts of New Jersey and Illinois.
The definitive agreement signed by MXenergy and Constellation Energy is scheduled to close in the third quarter, subject to required regulatory approvals and approval by MXenergy shareholders.
Constellation Energy demonstrates its commitment to environmental stewardship and a clean energy future by delivering innovative energy solutions that help customers control energy use, reduce greenhouse gas emissions and utilize sources of renewable energy.
MXenergy is one of the country's largest independent suppliers of energy to mass market customers throughout the United States and Canada. It was founded in 1999 and received major financial support from a number of private equity investors, most notably Denham Capital Management LP, and Charterhouse Group, Inc. MXenergy was the first retail marketer to provide carbon offsets for its customers through the planting of a certified pine forest in Georgia.
BofA Merrill Lynch acted as financial adviser to MXenergy on the transaction, and Duff & Phelps delivered a fairness opinion to the MXenergy Board of Directors.