NRG Rejects $6.08 Billion Exelon Bid

Power generation company NRG(NRG Quote) has rejected a $6.08 billion buyout offer from Exelon(EXC Quote).

On Oct. 19, Exelon, also a power generator, made an unsolicited offer to buy NRG in an all-stock transaction with a fixed exchange ratio of 0.485 an Exelon share for each NRG share.

But NRG said in a news release Sunday that its board unanimously rejected the proposal because it "significantly undervalues" NRG.

"Based on the proposed fixed exchange ratio of 0.485, NRG stockholders would own 17% of the combined company while contributing 30% of a combined company recurring cash flow in 2008," the release said.

NRG also described the offer as "highly conditional" because Exelon has yet to line up committed financing and its credit rating has been downgraded.

NRG shares finished Friday up $2.11, or 9.7%, at $23.86.

Exelon shares ended the session up $3.22, or 6.4%, at $53.82.