December must be the month for mega-utility mergers to be announced. Almost a year ago to the day, Exelon (NYSE:EXE) announced its plan to buy New Jersey-based Public Services Enterprise Group (NYSE:PEG) to create the country's largest utility. Today, FPL Group (NYSE:FPL) announced its intention to buy Motley Fool Income Investor selection Constellation Energy (NYSE:CEG) to create the nation's largest "competitive energy supplier," capable of generating more than 42,000 megawatts of power.

The deal, valued at $11 billion, will convert each Constellation share immediately prior to the merger into 1.444 shares at the time of the merger. According to both companies, this will represent a premium to Constellation shareholders of approximately 15%.

Approximately half of the power generated by Constellation is through nuclear and a third of it through coal. The combined company would be the third-largest operator of nuclear power plants behind Exelon and Entergy (NYSE:ETR). Yet Constellation also engages in energy trading, a field that was tarnished by the collapse of Enron, but where prices are not regulated. The merged companies would now have far-flung operations along the entire East Coast and across the country. Constellation maintains power plants in California, Illinois, New York, and Pennsylvania, in addition to its main facilities in Maryland. FPL is the parent company of Florida Power & Light.

In reality, it's been a pretty busy year for energy-related mergers. Duke Energy (NYSE:DUK) bought Cinergy (NYSE:CIN) in a $9 billion deal, and Warren Buffett's Berkshire Hathaway (NYSE:BRKa) (NYSE:BRKb) made a $5 billion deal for PacifiCorp (plus debt assumption of $4.3 billion). The spate of acquisitions has been helped along by the congressional repeal this year of a Depression-era law limiting the creation of interstate utility behemoths. With growing cash balances and share prices rising, utilities have been eager to make acquisitions to fuel future growth. Consolidation in the industry has totaled more than $430 billion this year.

Energy trading, or what is termed merchant energy, resells energy on the open market, typically during peak demand periods. For a while, the term "merchant energy" was a scarlet letter for companies. Enron's collapse, allegations of manipulation of California's energy market, and a host of corporate credit downgrades caused many companies to slash their speculative trading operations. That's apparently of little concern these days, and the FPL-Constellation "merger of equals" will seek to dominate that market.

It's estimated that the two companies will have a combined market cap of $28 billion on revenues of $27 billion. With all of their facilities, they will have $57 billion in combined assets that can service more than 40 million homes and business, giving a warm glow to December's holidays.

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Both Duke Energy and Constellation Energy are Motley Fool Income Investor selections.

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Fool contributor Rich Duprey does not own any of the stocks mentioned in this article. The Motley Fool has a disclosure policy.