All of the states where Pepco Holdings Inc., Atlantic City Electric's parent company, does business has approved the proposed Pepco/Exelon merger. The District of Columbia has said "no."
SALEM -- The planned mega-merger between Atlantic City Electric's parent company, Pepco Holdings Inc., and energy giant Exelon has hit a snag after regulators in the District of Columbia rejected the proposal.
The decision by District of Columbia's Public Service Commission (PSC) won't be the last word, the companies say. They plan to appeal the denial.
"We remain convinced our merger proposal is in the public interest, and we will continue working to complete the merger," said Myra Oppel, regional communications vice president of Pepco Holdings, in a joint statement issued on behalf of both Pepco and Exelon on Friday.
"We plan to file a petition for reconsideration before the PSC within the 30-day period and are not at liberty to discuss the specifics of our merger approach at this time."
Pepco and Exelon announced their plan to merge on April 30, 2014.
If it is eventually approved, the deal would bring together Exelon and its three electric and gas utility companies -- Baltimore Gas and Electric, ComEd and PECO -- with Pepco Holdings Inc.'s three utilities -- Atlantic City Electric Delmarva Power and Potomac Electric Power Company.
Exelon is based in Chicago and Pepco Holdings Inc. is based in the nation's capital.
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In all of the states where Pepco subsidiaries do business -- New Jersey, Delaware, Maryland and Virginia -- the $6.8 billion merger plan has been approved by regulators -- except in Washington. New Jersey's Board of Pubic Utilities gave its blessing to the merger in June.
The plan has also been approved by the Federal Energy Regulatory Commission.
The District of Columbia's Pubic Service Commission voted on Aug. 25 to deny the merger application.
The PSC concluded "the transaction as proposed by Exelon and Pepco is not in the public interest," according to a press release issued by the PSC on the day of the rejection.
The action triggered a 30-day window for Exelon and Pepco to file an appeal with the PSC.
After the merger plan was announced, utility officials said Atlantic City Electric would retain its name, its Mays Landing headquarters and no major layoffs of ACE employees were expected.
Among the benefits the merger would bring, officials have said, are $62 million in direct credits to customers and upgrades to the company's infrastructure.
ACE has faced some major challenges in recent years with major storms in its service region, the latest being the June 23 storm which caused extensive damage to power lines in parts of Gloucester County.
Atlantic City Electric has more than 540,000 customers in its South Jersey service area.
Bill Gallo Jr. may be reached at bgallo@njadvancemedia.com. Follow South Jersey Times on Twitter @TheSJTimes. Find NJ.com on Facebook.
