The Fort Worth, Texas Star-Telegram reports that private capital groups Blackstone Capital Partners LP and the Carlyle Group are considering their own bid to take TXU private. While it may seem a little late in the day for a new bid – after all the TXU board has already approved the offer from KKR and Texas Pacific Group – the transaction is in a “go shop” period during which the company can consider other offers.
Merger politicking is always interesting to watch, and Texas is always a reliable source of notable politickers. The Star-Telegram notes that while KKR/Texas Pacific worked hard for support from environmentalists and were offering retail consumers rate cuts up to ten percent, opposition to the deal remained “among Texas Legislators”:
They have expressed disappointment over the rate reduction, saying that it isn’t enough. Some lawmakers are also annoyed that TXU apparently will bypass state regulators on its way to completing the deal. Consumer groups still are angry that TXU is offering only 10 percent rate discounts.
Of course, rate cuts will encourage greater power consumption, so too much of a cut could start to trouble environmentalists. Fortunately, even with a ten percent cut TXU’s retail rate is higher than most of its rivals in the area. (Don’t Texas consumers realize they can shop around?)