Warren Buffett's Berkshire Hathaway Inc. is reaching into its deep pockets to give a steady hand to Constellation Energy Group Inc. and, at the same time, grab a bargain.
Berkshire's MidAmerican Energy Holdings Co. said Thursday that it will buy Constellation for $4.7 billion and give it an immediate $1 billion infusion after shares of the nation's largest wholesale power seller plummeted and liquidity concerns had analysts worried it would go out of business.
"Obviously we're in unprecedented times," MidAmerican President and CEO Gregory Abel said. "Liquidity and solvency issues are a top priority for many companies. We don't have any of those concerns, again, at MidAmerican and Berkshire."
Des Moines, Iowa-based MidAmerican will pay $26.50 per share in cash for Baltimore-based Constellation, well off the utility's 52-week high of $107.97 reached Jan. 8. The shares traded as high as $67.87 last week before hitting a low of $13 Tuesday.
Friday, September 19, 2008
Constellation Energy: Stars Align for Buffett
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