Exelon (NYSE:EXC) is already the biggest utility company in the U.S., and it has agreed to buy Pepco (UNKNOWN:POM.DL) for $6.8 billion.

But Fool contributor Tyler Crowe and energy and materials analyst Joel South say Exelon didn't make the purchase to make an even larger footprint in the utility space; it was more to diversify its holdings there. Pepco also gives Exelon stable revenue in a regulated -- and therefore less volatile -- business, even if the overall income needle won't move too much from this purchase. 


Joel South has no position in any stocks mentioned. Tyler Crowe has no position in any stocks mentioned. You can follow them on Twitter @TMFEnergy and @TylerCroweFool, respectively.

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