US Judge Dismisses NRG Suit Vs Exelon Over Disclosure

A federal judge dismissed a lawsuit filed by NRG Energy Inc. (NRG) against Exelon Corp. (EXC), saying NRG failed to prove Exelon made false statements in its offer for the merchant power generator.

Exelon last fall launched a hostile bid for NRG Energy, offering to pay a fixed ratio of 0.485 Exelon share for each NRG share in a bid to create the largest power generator in the U.S. by output. NRG Energy's board has stiffly resisted the bid, saying it undervalues the power plant operator.

NRG Energy in its effort to fight off Exelon's offer filed a lawsuit in U.S. District Court in New York City in March, claiming Exelon's offer was misleading. NRG Energy contends Exelon doesn't plan to follow through on its exchange offer unless it reaches a negotiated deal, requesting the court force Exelon to disclose these plans.

U.S. District Judge John Koeltl in a ruling signed Friday found NRG Energy failed to prove Exelon made a false statement or material omission in its exchange offer. The judge added NRG Energy is free to make its case to its shareholders.

NRG Energy is scheduled to hold its annual meeting on July 21. Exelon is proposing at the meeting to expand NRG Energy's board and add its own members as it tries to complete the deal amid the resistance of NRG's current board.

Officials at Exelon and NRG Energy had no immediate comment on the ruling.

-By Mark Peters, Dow Jones Newswires; 212-416-2457; [e-mail]