Constellation Energy (CEG, Financial) keeps making headlines, and this time it's for their plan to acquire Calpine Corp for $16.4 billion. Bloomberg reported that the payment will be done in a mixture of cash and stock, CEG will also take on Calpine's $12.7 billion debt in addition to that.
Grid Strategies forecasted that the power demand would grow 16% over the next five years driven by data centers running artificial intelligence operations, electrification of cars and new factories. And in anticipation of the rising energy consumption, Constellation expands to generate more electricity than any company in the U.S.
The takeover will be a big deal in the US power industry and will significantly profit Calpine's shareholder who bought the company for $5.5 billion back in 2018 and made it a private company.
Constellation operates power facilities with multiple energy sources and by acquiring Calpine, Constellation will add Calpine's natural gas and geothermal capabilities to its portfolio making Constellation one of the largest clean energy providers in the US.
Bloomberg reported that the deal is expected to add Constellation's earning per share by more than 20% in 2026.
