In propping up Constellation, don't let BGE customers fall

Sep 18, 2008 Read more: Baltimore Sun 22
Just as Merrill Lynch sought solace in the arms of Bank of America over the weekend, just as Lehman Brothers looked in vain for a stable partner, Shattuck knew even back then he might need to tether his own ... Read more
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Carl

Baltimore, MD

#1 Sep 18, 2008
We need to have a boring, predictable utility again, I am afraid. One that concentrates on customers, not stockholders.

While all this crap was going on, BGE was cutting back on wire and infrastructure maintenance. Wait until your lights go off and see what I mean.

This company needs to do its job-- literally, provide power to the people. Shattuck should go work for a bank like Lehma... whoops... Alex. B... whoops... see any pattern here?
MrEd

Parkville, MD

#2 Sep 18, 2008
Smells like they will be crying for rate increase.
Fake-Name-Guy

Baltimore, MD

#3 Sep 18, 2008
Does this mean we would have to change to 230V, 50Hts AC power?
Ted Annapolis MD

Clarksville, MD

#4 Sep 18, 2008
Why doesn't Maryland take over the utility? This is a good opportunity. Yes, the state has money problems but Constellation is--and will be--far more expensive than having Maryland own the utility.
John S

Baltimore, MD

#5 Sep 18, 2008
Hey Jay - Do you really think Maryland's regulators and legislators should do anything to further screw things up? A few years back, they got involved and blocked the the fpl merger which, as it turns out, is what Constellation needed to avoid the mess its in now. Maryland's legislators have proven time and time again that they cause problems for MD businesses and individual taxpayers, not fix them.
Pelham21093

Baltimore, MD

#6 Sep 18, 2008
Why is i that reporters can play monday morning quarterback and question moves by politicians, businesses, etc when they have no idea of how they work. I'm not defending or offending BGE, but for a reporter to constantly second guess, after the fact is no different than a fan saying they should've called a different play AFTER the coach's play didn't work. It is ironic that "breaking news" (the most over used term in all of the media) reported by the sun is Mid-America holdings is buying BGE. Go ahead Jay, make your ten minute phone call and then write about why this is or isn't a good idea. And I had to laugh when the writer stated he just hopes the BGE customer doesn't get left out in the fall. Rule number one of business. Companies only buy companies when they think they can make money. If MidAmerica thinks BGE is underperforming, they'll sell it. That's the reality.
FireTrembley

United States

#7 Sep 18, 2008
Warren Buffet will run CEG exponentially better than Mayo did. This is great news for Bmore.
Magicman

Porter, TX

#8 Sep 18, 2008
John S wrote:
Hey Jay - Do you really think Maryland's regulators and legislators should do anything to further screw things up? A few years back, they got involved and blocked the the fpl merger which, as it turns out, is what Constellation needed to avoid the mess its in now. Maryland's legislators have proven time and time again that they cause problems for MD businesses and individual taxpayers, not fix them.
Of course the Sun devotes no effort to questioning that move.
YouHelpFixIt

Scottsdale, AZ

#9 Sep 18, 2008
Ted Annapolis MD wrote:
Why doesn't Maryland take over the utility? This is a good opportunity. Yes, the state has money problems but Constellation is--and will be--far more expensive than having Maryland own the utility.
This state cannot effectively run its highway rest stops, what makes you think they can run a utility.
Bob

Bel Air, MD

#10 Sep 18, 2008
Well, we consumers WILL be left out in the cold- no doubt. And as Pelham pointed out, MidAmerica will most likely be selling BGE yet again. One though who will NOT be left out in the cold will be Mayo A. Shattuck III who I'm sure will be getting a MASSIVE payout for 'engineering' this gig- oh, and his options will all vest as well. What a jerk.
trinfrop

Baltimore, MD

#11 Sep 18, 2008
i'd be nervous if i was a maryland ceg employee - i hope for their sake, and the sake of maryland, that ceg's headquarters stay in maryland. how much of a deal can maryland make though? with the maryland budget in tatters, how 'sweet' of a deal can they offer midamerica to keep ceg here? maybe midamerica doesn't even care about any deals, and just wants to move the headquarters to iowa...so much still unknown....
Doodads

Baltimore, MD

#12 Sep 18, 2008
This could really blow up for MD consumers and CEG employees. Without looking at their financials, the fact that CEG will be issuing $1B of preferred stock at an 8% dividend has GOT to be more expensive than their current financing arrangements. How much of this will be pushed down to BGE customers we'll find out soon enough. Plus Buffett is usually a "hands on" investor, so he will most likely be implementing operational changes.
You knew when CEG brought Shattuck on board that they wanted him to find a buyer, but this CAN'T be what the board had in mind...
Charleyhorse

Baltimore, MD

#14 Sep 18, 2008
Mayo Shattuck destroys another local business, while making millions in the process.
Wayne

Montpelier, VA

#15 Sep 18, 2008
I have no issue with CEG being bought out by Mid America.. and after further review, nobody else should have any issue with it either.

Take a look at Berkshire Hathaway's holdings. Consider how diversified they are, and note that they have returned an average of 21% per year for the last 42 years.

Maryland will be better off for having such a large and influential company being run by competent people, and not fly-by-night psuedo-capitalist good ole boys.

And also... the idea that the state could run CEG better than Warren Buffett can is absolute insanity.

Another insane idea is that Buffett would sell CEG a short time from now - if you look at Berkshire Hathaway (and Warren Buffett's) investment history, their aim is to create stability and profitability, and not to "flip" companies after they have suitably cooked the books as many private equity firms are so wont to do.
Surf52

Baltimore, MD

#16 Sep 18, 2008
Don't worry, BGE customers won't be left to fall. After all, what do you think ultimately is propping the whole thing up?
Mike

Chicago, IL

#17 Sep 18, 2008
The only time that public utilities, finiancial markets and others screw up (and always have to be rescued at huge cost to the taxpayers) is when the government fails to do its job in the first place by buying into the "deregulation" nonsense of the Republicans. It has NEVER worked, the public has ALWAYS gotten screwed, and the government has ALWAYS had to step in!
jag

Bel Air, MD

#18 Sep 18, 2008
Ted, do you REALLY want the "current occupants" in Annapolis to screw this up too???? I think not - I'll hedge my bets with Warren Buffet's crew (no pun intended. Advice to Mayo: it's time to leave town.
Ted Annapolis MD wrote:
Why doesn't Maryland take over the utility? This is a good opportunity. Yes, the state has money problems but Constellation is--and will be--far more expensive than having Maryland own the utility.
Steven

Sanford, NC

#19 Sep 18, 2008
Warning to Wayne & jag...do some quick research. Ask the good people of Iowa how inexpensive, I mean expensive, their utilities have become under Mr. Buffet.

Mr. Buffet will use the panic and fear of Maryland politicians and consumers to make sweetheart deals for himself at more tax payers expense than even government could get away with. Mr. Buffet is no friend, but a fiend.

Best solution: Make BG&E a public utility, electricity should serve the customers, not the stockholders.
Surf52

Baltimore, MD

#20 Sep 18, 2008
Steven wrote:
Warning to Wayne & jag...do some quick research. Ask the good people of Iowa how inexpensive, I mean expensive, their utilities have become under Mr. Buffet.
Mr. Buffet will use the panic and fear of Maryland politicians and consumers to make sweetheart deals for himself at more tax payers expense than even government could get away with. Mr. Buffet is no friend, but a fiend.
Best solution: Make BG&E a public utility, electricity should serve the customers, not the stockholders.
Oh, it's way too late for that. The addled piggies in Annapolis now have cover to run to. They'll sign and squeal all the way. Warren Buffett didn't get where he is by being stupid.
Kev

Germantown, MD

#21 Sep 18, 2008
Imagine if the state didn't interfere with the sale 2 years ago. We wouldn't have this much anxiety. Better yet, imagine if Sarbanes' Banking & Finance Committee didn't exempt commodities traders from oversight, fuel prices wouldn't have skyrocketed -- increasing costs across the board and impeding folks' mortgage payments. Imagine if they put some regulation in effect in 1994 when Clinton lowered the credit allowances, effectively dumbing down our economy... to boot, Clinton's appointment of a buffoon to run FannieMae a few years back that lost 100 mil doesn't help, either.

But of course I digress... Like how in 1997,'98 and '99 the Senate Banking and Finance Committee, chaired by the apostle, Paul Sarbanes, did not act on requiring derivative reporting on financial statements... or the fact that for the past 2 years, the world has been saying "look, we have a real estate crisis here" without asking the presumptive knee-jerk reaction "and what are we going to do about it?" The latter isn't the President. The President doesn't make the laws... both Houses do. Who's in control there? Who is asleep at the wheel? Sorry Mr. Biden, charitable giving is patriotic, not higher taxes. Higher taxes impede on our liberties which is what this country was founded on. Democracy only exists because democracy is the best means to protect liberty. Thus, democracy protects a 227 year old Constitution.

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