updated 9/18/2008 11:11:06 AM ET 2008-09-18T15:11:06

Natural gas and electric company MidAmerican Energy Holdings Co., a unit of Warren Buffett’s Berkshire Hathaway Inc., said Thursday it will buy Constellation Energy Group Inc. for $4.7 billion in a cash-and-stock deal.

Des Moines, Iowa-based MidAmerican will pay $26.50 per share for the Baltimore-based utility. The two companies plan to sign a definitive merger agreement by the end of business Friday, after which Constellation will issue $1 billion in preferred equity to MidAmerican.

The deal was unanimously approved by both companies’ boards and is expected to close within nine months, pending approval from shareholders and government officials.

Buffett’s rescue comes amid turbulent times for Constellation, as concerns about its liquidity have sent the stock down nearly 60 percent this week. On Wednesday Standard & Poor’s placed Constellation’s investment-grade “BBB” debt ratings on Credit Watch “developing,’ meaning they may be revised higher or lower, or maintained.

The famed investor had also reportedly been in rescue talks with insurer American International Group Inc. before the Federal Reserve bailed out the insurer.

MidAmerican’s deal ends speculation that French nuclear power giant Electricite de France SA would make an offer for Constellation. EDF, which had considered raising its stake in Constellation, said Thursday it had ruled out such a move because “all the conditions are not met to do so.”

In its statement, EdF said it is “keeping its options open,” and still intends to “play a major role in the nuclear revival in the United States,” by investing in building and operating next-generation nuclear plants there. Last year, EdF and Constellation set up a 50-50 joint venture, Unistar Nuclear, with the aim of building four next-generation EPR nuclear reactors.

MidAmerican bills itself as a global leader in energy production from sources including natural gas, hydroelectric, nuclear, coal, geothermal and wind. The company, which says it has more than $12 billion in annual revenue, distributes energy in the U.S. and U.K. consumer markets, with approximately 6.7 million electricity and gas customers.

MidAmerican subsidiaries include California utility PacifiCorp..

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 2.79%
$30K home equity loan FICO 5.78%
$75K home equity loan FICO 4.54%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.57%
13.57%
Cash Back Cards 17.91%
17.91%
Rewards Cards 17.15%
17.15%
Source: Bankrate.com