Constellation Energy to buy Calpine in $26.6 billion deal

(Reuters) -Constellation Energy said on Friday it would buy privately held Calpine Corp, a geothermal and natgas energy company, in a cash-and-stock deal valued at $26.6 billion including debt, sending Constellation’s shares up 8.8%.

The deal comes at a time when electricity demand is expected to rise to record highs this year, according to data from the U.S. Energy Information Administration.

The transaction, which is expected to close in the second half of 2025, could add $2 billion to Constellation’s free cash flow annually, and together the companies would have nearly 60 gigawatts (GW) of capacity from zero- and low-emission sources, including nuclear, natural gas and geothermal, Constellation said.

Reuters was the first to report in May last year that the three investment firms that took Calpine private in 2017 – Canadian Pension Plan Investment, Energy Capital Partners and Access Industries – were looking at options for Calpine including a sale.

Unlike regulated utilities, Calpine being an independent power producer allows it to sell power at market prices.

(Reporting by Seher Dareen in Bengaluru; Editing by Shilpi Majumdar and Shounak Dasgupta)