Constellation Energy is selling its Fellon-McCord & Associates energy consulting and management subsidiary to the company’s co-founder, Andrew R. “Drew” Fellon, splitting it from its Constellation NewEnergy retail natural gas sales unit, the company said Thursday. The move comes five years after Constellation acquired the Kentucky-based retail marketer.

As part of the agreement, Constellation Energy’s Customer Supply Group unit and Fellon-McCord will maintain a strategic alliance, allowing the companies to meet the needs of current customers and pursue joint opportunities.

Since its acquisition by Constellation Energy in 2003, Fellon-McCord and the related retail gas commodity business have grown successfully, Constellation said. The separation of the energy consulting and management unit and Constellation NewEnergy’s commodity sales and risk management services is expected to better position each company to pursue independent growth strategies.

“These lines of business are complementary but distinct, and this restructuring allows each company to focus on what it does best,” said Mark P. Huston, co-president of Constellation Energy’s Customer Supply Group. “At Constellation Energy, our expertise is commodity risk management…Our retail gas unit will gain the independence to pursue growth opportunities aligned with its core mission, while the strategic alliance allows us to work jointly with Fellon-McCord to serve existing customers and pursue cross-selling opportunities.”

“The strategic alliance ensures a seamless transition for our existing customers and provides the flexibility each company needs to pursue independent transactions or enter new markets,” said Drew Fellon, president of Fellon-McCord & Associates. “The structure allows Fellon-McCord to preserve the most beneficial elements of a joint working relationship with an industry leader such as Constellation Energy. We also gain the freedom to tailor a growth strategy specifically tied to the needs of our customers and the dynamics of the energy markets.”

Closing of the agreement is targeted for June 30. Fellon-McCord will maintain its headquarters in Louisville, KY, in its present location. The Constellation NewEnergy retail gas unit also will maintain its headquarters in Louisville, and coordinate commodity sales and risk management activities with Constellation Energy’s gas marketing operations in Houston, Omaha, Waukesha, WI, and Baltimore. The unit will be led by Co-Chief Commercial Officers Kevin Watson and Bret Feller. It serves more than 14,000 commercial, industrial, and institutional facilities that annually consume more than 491 Bcf of natural gas. Constellation NewEnergy Gas is a division of Constellation Energy and a sister company to Constellation NewEnergy.

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