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Calpine Rejects NRG Takeover Bid
A merger that would have united the two largest U.S. independent power producers has hit a roadblock.
Calpine Corp. (CPN) has rejected NRG Energy Inc.’s (NRG) initial offer, saying the 0.534 shares for each share of Calpine’s approximately 500 million shares outstanding is inadequate.
“I don’t think anyone should be surprised by Calpine’s announcement,” Gordon Howald, an analyst with Calyon Securities USA Inc. in New York, told Bloomberg News. Howald has a “buy” rating on NRG shares, but doesn’t own any. “If they were to accept the first bid as laid out, they would probably be doing their shareholders a disservice.”
Calpine…
2Jun2008 | Money Morning | Comments Off | ContinuedNRG Looks to Electrify its Business with $11.3 Billion Calpine Takover
Princeton, NJ- based NRG Energy Inc. (NRG) has publicly acknowledged its estimated $11.3 billion takeover bid for Calpine Corp. (CPN) – a wholesale provider of electricity emerging from chapter 11 bankruptcy protection.
NRG acknowledged Wednesday that it made the initial $22.98 a share offer on May 14. NRG said the deal assumes Calpine had 500 million fully diluted shares outstanding as of May 13. That calculation would value all of Calpine at $11.35 billion.
NRG offered to pay 0.534 shares for each share of Calpine, the company said in a statement. Based on NRG’s Wednesday closing price of $42.51, the deal values each…
23May2008 | Money Morning | Comments Off | Continued
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