(Update adds stock prices after the market open.)

NRG Energy's ( NRG) board turned down Exelon's ( EXC) revised takeover bid on Wednesday.

Exelon upped its "best and final" all-stock offer last week to buy NRG, citing a series of newly discovered synergies. Exelon said it would offer 0.545 of its own shares for each NRG share in the all-stock transaction. Exelon initially offered an exchange ratio of 0.485 about eight months ago.

In a letter to Exelon CEO John Rowe, NRG CEO David Crane and Chairman Howard Cosgrove said the increased offer doesn't yet value NRG properly. In particular, NRG noted that Exelon credited less than $1 a share of value to the company's Reliant Energy acquisition. Instead, NRG said the value should come to $4.50 a share.

To drive that point home, in a separate press release, NRG increased its 2009 guidance, boosting earnings before interest, taxes, depreciation and amortization by $325 million to $2.5 billion to now reflect Reliant Energy contributions.

Still, in rejecting the proposal, NRG noted that the revised offer was a "step in the right direction."

A combination of the two companies would create the largest U.S. power generating concern.

The fight will likely continue. Exelon is pushing its own slate of directors for NRG's shareholders' meeting on July 21.

Shares of NRG were trading hands at $23.19 in early morning trading, an increase of $1.11, or 5%, from Tuesday's closing price. Exelon gained 50 cents soon after the opening bell, to come to $48.25.
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