It might be that persistence pays even when one’s rival is Warren Buffett’s MidAmerican Energy Holdings Co. News reports Tuesday said a deal for Electricite de France SA (EDF) to acquire half of the nuclear power business of troubled Constellation Energy Group Inc. is close at hand, potentially scotching MidAmerican’s signed agreement to take over the company.

Citing unnamed sources, Bloomberg reported that a deal could be announced this week and quoted MidAmerican Chairman David Sokol as saying his company has “no intention to alter our bid.”

After rejecting a sale of all of Constellation to EDF in October (see Daily GPI, Oct. 17; Sept. 22) in favor of a $4.7 billion offer from MidAmerican, Constellation’s board said earlier this month it would talk with the French company about its subsequent proposal to acquire half of the nuclear assets (see Daily GPI, Dec. 9). EDF subsidiary EDF International is proposing to acquire through a joint venture a 50% ownership interest in Constellation’s nuclear generation and operation business for $4.5 billion (see Daily GPI, Dec. 4).

When Constellation said yes to MidAmerican it was facing a credit downgrade.

Taking a share in the Constellation nuclear business “makes sense for EDF from a strategic point of view,” Peter Wirtz, an analyst at WestLB in Dusseldorf, Germany, told Bloomberg. “It’s not cheap, but it’s cheaper than what EDF is paying for British Energy to get entry into the UK”

Earlier this year EDF agreed to buy British Energy for $23.2 billion. Also this year, EDF snatched up Eagle Energy Partners from the bankruptcy of Lehman Energy Holdings (see Daily GPI, Sept. 30).

EDF’s proposal to acquire the stake in Constellation’s nuclear business provides for an up-front $1 billion cash investment in Constellation to be credited against the purchase price for EDF’s interest in the nuclear business, and an option under which Constellation could sell nonnuclear generation assets to EDF that have an aggregate value of up to $2 billion. The joint venture would run five of Constellation’s nuclear reactors, including the two at Nine Mile Point and the one at the Robert E. Ginna plant in New York, and the two at Calvert Cliffs in Maryland. Constellation and EDF are already in a 50-50 joint venture that was created in the summer of 2007 called UniStar Nuclear Energy LLC to develop new nuclear reactors in the U.S.

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