UPDATE 1-Norway SWF seeks to block Buffett on Constellation

(Adds more details, quotes, shares)

By Wojciech Moskwa

OSLO Dec 17 (Reuters) - Norway's sovereign wealth fund on Wednesday threw a spanner into U.S. investor Warren Buffett's deal to take over Constellation Energy CEG.N, seeking to buy time to evaluate a rival bid by Electricite de France (EDF.PA).

Norway's $339 billion oil fund said it filed a law suit in a Maryland court to delay a Dec. 23 Constellation shareholders' meeting due to vote on a takeover by MidAmerican Energy Company, a unit of Buffett's Berkshire Hathaway Inc (BRKa.N).

"In our opinion, the MidAmerican agreement undervalues Constellation, and we expect the board to work for a solution that offers the highest value," said Anne Kvam, head of corporate governance at the fund.

MidAmerican's $4.7 billion takeover in September was backed by Constellation's board. However in early December Electricite de France said it would pay $4.5 billion for half of Constellation's nuclear assets and give the U.S. company the option to sell it up to $2 billion more of its non-nuclear assets.

Norway's fund said it holds 4.8 percent in Constellation and likes to take an active role in the corporate governance of the companies in its portfolio. It is regarded as the world's most transparent sovereign wealth fund and is the second largest after the United Arab Emirates' fund.

"We are one of the biggest shareholders and take these necessary steps in order to safeguard our financial interests," Kvam said.

A source familiar with the matter told Reuters on Tuesday that Constellation was leaning towards an agreement with Electricite de France but still needed to obtain waivers of its bank covenants to seal the deal. [ID:nN16186093]

Kvam said: "The shareholder meeting is less than a week away, and we need to ensure that there is time for the board and the shareholders to evaluate the situation and choose the best solution."

The U.S. court has scheduled a hearing on Dec. 22, the oil fund said.

MidAmerican has said it does not plan to raise its bid for Constellation. If Constellation rejects MidAmerican's offer it would have to issue about 20 million common shares to the company, or about 9.9 percent of its outstanding stock, and pay it about $593 million in cash.

Shares in Electricity de France were up 3.48 percent at 42.8 euros at 1407 GMT, while U.S. stocks had not yet began trading in New York.

(Editing by Sharon Lindores)