State regulators on Friday set a schedule for their consideration of the $4.7 billion merger between Constellation Energy and MidAmerican Energy Holdings Co. and defined the scope of the proceedings.
The agency said it would also consider whether a competing offer would better serve ratepayers, and whether re-regulation of Maryland’s power plants should be a condition of approval of the merger.
An order by the state Public Service Commission order sets evidentiary hearings for the week of Feb. 16, among other deadlines running through the end of March. The agency has said it expects to rule on the merger by April 15.
But the order also admonishes those taking part in the proceeding to limit their arguments to, “an articulable public interest.”
“This proceeding is neither a broad policy forum nor an opportunity for the parties to litigate issues more properly addressed elsewhere,” the PSC wrote in its eight-page order.
Constellation spokesman Rob Gould said in a statement that the PSC order was “thoughtful and balanced and takes into consideration the interests of all stakeholders.”
Constellation was forced to seek a merger with MidAmerican after its stock value slid rapidly over three days in mid-September, and accepted a sale price of $26.50 a share. Shareholders filed suit when Constellation’s largest investor, French energy giant Electricite de France, said it had offered $35 a share for the company.
At a hearing earlier this month, PSC Chairman Douglas Nazarian told lawyers from Constellation and MidAmerican that the approval process would not be a forum for disgruntled shareholders.
However, the PSC said it would consider arguments “demonstrating that the public interest would be served by a concrete and viable alternative transaction.” But the agency said it would not consider whether shareholders would benefit from such a transaction, or whether company management breached its fiduciary duties to investors in accepting MidAmerican’s lower offer.
The PSC also directed its staff to determine whether merger approval should hinge on Constellation returning control of Baltimore Gas and Electric power plants to state regulators. State Sens. E.J. Pipkin and Jim Rosapepe first raised the idea in September.
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