Public Service Enterprise Group (PSEG) and Exelon met with the New Jersey Board of Public Utilities (NJBPU) staff to discuss the status of their proposed merger and the companies’ settlement offer valued at $1.46 billion after the NJBPU said it concurred with a staff recommendation that staff not accept the proposal offered by Exelon and PSEG related to the merger.

A green light from the NJBPU remains the final regulatory hurdle the merger must clear before it can close. The NJBPU recently adopted a resolution inviting the parties in the merger proceeding to meet with NJBPU staff as soon as possible and continue negotiations towards a possible settlement (see NGI, Aug. 7).

PSEG and Exelon “appreciate the NJBPU’s commitment to engage in constructive and expeditious negotiations designed to reach a prompt resolution of the merger case,” PSEG said.

On the evening of Aug. 4, Exelon’s board of directors met to consider the status of the merger. The board authorized Exelon management to continue negotiations and report to the board through Aug. 21, and reconvene the board if a satisfactory settlement was not concluded by that date. The board also authorized management to terminate negotiations earlier if they will not result in a satisfactory settlement agreement.

“We are pleased that the NJBPU staff is prepared to move forward with accelerated negotiations,” said John Rowe, CEO of Exelon. “We remain committed to the financial boundaries that we have outlined in our proposal but are flexible about the details. It has taken a great deal of effort to get this far and it makes sense to spend a little more time to try to make this work.”

Meanwhile, Exelon and PSEG on Aug. 10 submitted a filing at FERC seeking authorization to amend the interim fossil mitigation that they previously committed to provide in connection with their pending merger, which was approved by the Commission last year (see NGI, July 4, 2005).

Specifically, the companies are asking that they be allowed to amend their interim fossil mitigation by extending the time that an offer cap commitment can be used for interim mitigation [EC05-43].

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