US-based energy firm Exelon will sell its three coal-fired power plants located in Maryland, US for $400m to Raven Power Holdings, fulfilling its commitment to divest the plants as part of its merger with Constellation.

The three plants include 1,273MW Brandon Shores and 976MW H A Wagner in Pasadena and 399MW C.P. Crane in Middle River, which are collectively known as Maryland Clean Coal.

Exelon president and chief executive Christopher M Crane said the sale of these plants marks another important milestone in meeting the company’s merger commitments.

"Until the divestiture is completed, Exelon will continue to run these plants as we have in the past and in compliance with all regulations, and we look forward to a smooth and successful transition to the new owner," Crane added.

In addition, the sale will generate nearly $205m in cash tax benefits, with the majority of that amount realized in 2012 and 2013.

Raven Power Holdings, a new portfolio company of Riverstone Holdings, will retain the employees at the plants with comparable pay and benefits as per the terms of the agreement.

The transaction, which is expected to close in fourth quarter of 2012, is subject to approval by Federal Energy Regulatory Commission and U S Department of Justice.

Citi and Goldman Sachs & Co acted as financial advisors and Morgan, Lewis & Bockius as legal counsel to Exelon for this transaction, while Vinson & Elkins served as legal counsel to Riverstone.