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Constellation, a unit of Exelon Corp. entered into a definitive agreement with ConEdison Solutions, a unit of Consolidated Edison, to buy its retail electricity and natural gas business, serving more than 560,000 commercial, industrial, public sector and residential customers across 12 Northeastern, mid-Atlantic, and Midwestern states, Texas and the District of Columbia.
The purchase strengthens Constellation’s position as a competitive energy supplier to more than 2.5 million residential and business customers across the continental United States.
Constellation will acquire ConEdison Solutions’ retail electricity and natural gas customer contracts and associated supply contracts. ConEdison Solutions will retain its focus on renewable energy, sustainable services, and energy efficiency solutions for commercial, industrial, residential and government customers.
“This agreement provides an opportunity to grow our retail electricity and natural gas business in strategically attractive markets where we’re best suited to match load served with Exelon generation assets,” said Joseph Nigro, CEO of Constellation. “ConEdison Solutions has a reputation for delivering value to customers, and our combined companies will continue that tradition with a broad array of energy products and services at competitive prices.”
Headquartered in Valhalla, N.Y., the retail electricity and natural gas business within ConEdison Solutions includes about 85 employees and is the 13th largest commercial and industrial and 16th largest residential electricity retailer in the U.S. The company delivered about 14 TWh of electricity and 1 Bcf of natural gas in 2015.
“With their industry-leading position, we are confident that the retail electricity and natural gas business will continue to thrive as part of Constellation,” said Mark Noyes, president and CEO of ConEdison Solutions. “This move will enable our company to focus our attention and our resources on making energy services and renewable energy offerings even more competitive and well-positioned for rapid growth. With this sale, we are realizing the rewards of over 18 years of successful participation in retail electricity and natural gas markets, and we will recommit our remaining people and resources to the growth of ConEdison Solutions.”
ConEdison Solutions’ retail electricity and natural gas business will operate under the Constellation brand after a post-closing transition period that will be complete in 2017. Residential and commercial customers of ConEdison Solutions’ retail electricity and natural gas business will experience no disruption to service as a result of the transaction and all existing customer contracts will be honored.
UBS Investment Bank is acting as financial advisor to ConEdison Solutions in connection with the transaction
The transaction is subject to the notification and reporting requirements under the Hart-Scott-Rodino Act. The companies expect to close the transaction in the third or fourth quarter 2016. The terms of the agreement were not released.