Exelon plans six-part bond sale for $6.8 billion Pepco takeover

Updated 6/8/2015 10:30 AM

Exelon Corp., the largest U.S. nuclear operator, is planning to sell bonds to finance its acquisition of Pepco Holdings Inc., a move that would create the biggest electric and natural-gas utility in the Mid-Atlantic region.

Exelon will sell notes in as many as six parts, the company said in a regulatory filing Monday. Exelon obtained a $7.2 billion financing commitment from Barclays Plc and Goldman Sachs Group Inc. last year for the purchase.

The Chicago-based utility agreed to buy Pepco for $6.8 billion in April, 2014, in a deal to expand its holdings in the mid-Atlantic and reduce reliance on its nuclear plants. The company has seen its stock market value fall by more than 10 percent in the past year, compared to a 7.3 percent gain in the Standard & Poor's 500 Index.

The longest portion of the offering, which will mature in 30 years, may yield as much as 2.15 percentage points more than comparable Treasuries, according to a person with knowledge of the deal, who asked not to be identified because the information isn't public.

Exelon's takeover of Pepco was approved by Maryland regulators over the objections of the state's top lawyer, who argued it would slow the growth of rooftop solar power. Exelon also received the approval of Delaware, and awaits the approval of the District of Columbia Public Service Commission.

To contact the reporter on this story: Cordell Eddings in New York at ceddingsbloomberg.net To contact the editors responsible for this story: Shannon D. Harrington at sharrington6bloomberg.net Faris Khan, Kenneth Pringle

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