Calpine, which has dual headquarters in San Jose and Houston, revealed details of the unsolicited all-stock bid Wednesday after one of its shareholders released a letter stating that an offer had been made last week.

Its shares rose 7.7 percent, or $1.64, to $22.92.

Princeton, N.J.-based NRG confirmed it made the offer May 14. The bid was initially valued at $22.98 per share but ended Wednesday valued at $22.70 per share. NRG estimated it would have to acquire about 500 million Calpine shares, putting the estimated cost at $11.3 billion, based on Wednesday's value.

The takeover attempt comes less than four months after Calpine emerged from a two-year stint operating under Chapter 11 bankruptcy protection. During its stay in bankruptcy court, Calpine jettisoned more than 1,000 employees, or one-third of its work force, while reorganizing more than $20 billion in debt.

More layoffs are likely if NRG's offer is accepted. In a letter detailing the rationale for combining companies, NRG said it believes it can lower annual expenses by about $100 million by eliminating duplicative jobs and other overlapping operations.

Princeton, N.J.-based NRG is familiar with the bankruptcy process, having spent seven months operating under Chapter 11 protection in 2003.

Despite its financial misery, Calpine has placed a nearly $19 billion value on its business, which consists primarily of 60 power plants that can produce up 23,000 megawatts of electricity _ enough to light more than 17 million homes.

NRG has 49 plants with a total capacity of 24,120 megawatts.

By adding Calpine, NRG believes it would be able to create a more diverse company better equipped to weather the ups and downs of electricity prices. That volatility is one of the reasons both NRG and Calpine wound up in bankruptcy court.

"This is, quite simply, the right deal, at the right point in time, between the right partners," said David Crane, NRG's chief executive officer.

In a statement, Calpine said its board is evaluating NRG's offer with the help of Goldman Sachs & Co.

Calpine is facing a leadership void that could work to NRG's advantage.

Turnaround specialist Robert May, who steered Calpine through bankruptcy, is still running the company but plans to step down by the end of this year.

"We believe the ability to graft NRG's management team onto the combined company would be viewed favorably by Calpine's directors and shareholders," Crane said.

NRG has proposed financing the purchase by swapping 0.534 shares of its stock for each Calpine share. Based on Wednesday's closing stock prices, the bid is valued at $22.70 per share _ a 7 percent premium above Calpine's market value. The offer represented a 16 percent premium when NRG first made the offer.

NRG shares fell nearly 4 percent, or 1.68, to $40.83.

Investors already are betting NRG will either have to raise its offer or another bidder will enter the fray.

Calpine's shares climbed $2.33, or nearly 11 percent, in after-hours trading Wednesday after finishing the regular session at $21.28, up 8 cents. NRG shares rose 36 cents to close at $42.51, then added 3 cents in extended trading.

Calpine was driven into bankruptcy in late 2005 under a pile of debt taken on while the company aggressively expanded to take advantage of rising electricity prices earlier in the decade. The strategy backfired, though, as electricity prices began a steady descent in 2002, leaving Calpine unable to carry its heavy debt load.