Constellation Energy to Separate Merchant, Retail Operations - TheStreet

Shares of

Constellation Energy


rose sharply after the company disclosed plans to split its wholesale energy and power marketing business from its retail business and make

Goldman Sachs

(GS) - Get Report

an equity owner of its merchant energy business.

The company's shares recently gained $5.50, or 13.9%, to $45.13 in

New York Stock Exchange


The power company said the merchant energy business will operate as

Constellation Energy Group

. The retail energy and energy services company will be known as


. The company expects to complete the separation by mid-to-late 2001.

Additionally, Constellation said Goldman Sachs is expected to pay $250 million for up to 17.5% of the merchant energy business.

On Friday, Constellation reported lower-than-expected third-quarter earnings, citing lowered sales because of the summer's mild weather.