Petrohawk prices $188.5 million stock offering; HQ Maritime raises $5.23 million

By Sheri Kasprzak

New York, Jan. 26 - As oil prices advanced after three straight sessions of losses, oil explorer Petrohawk Energy Corp. led PIPE offerings with a $188.5 million stock deal Thursday. The company intends to issue 13 million shares at $14.50 apiece on Feb. 1.

Petrohawk had 73,536,379 outstanding shares as of Nov. 9.

The deal, which was announced Thursday morning, initially sent the company's stock down, but the stock made a comeback at the end of the day, gaining 33 cents, or 2.17%, to close at $15.53 (Nasdaq: HAWK). In after-hours trading, the stock lost 3 cents.

Proceeds will be used for the repayment of debt it anticipates incurring upon the purchase of Winwell Resources, Inc. and natural gas properties in northern Louisiana.

In other news, Petrohawk agreed to buy 3,322,441 shares of EnCap Invesments, LP. The shares will be purchased at a price equal to the net proceeds per share Petrohawk receives from the private placement.

Floyd Wilson, the company's chief executive officer, did not immediately return calls for comment on the deal.

Looking to the company's earnings, Petrohawk sustained a net loss of $36,424,000 for the quarter ended Sept. 30, 2005, compared with a net loss of $601,000 for the corresponding quarter in 2004.

Based in Houston, Petrohawk is an oil and natural gas exploration company.

Word of the offering came as oil prices climbed after sustaining losses for three days this week.

Oil prices gained $0.41 to close at $66.26 per barrel Thursday.

Moving away from the energy sector, HQ Sustainable Maritime Industries, Inc. concluded a $5,225,000 private placement, making it the second aquatic materials-based nutraceuticals developer to head to the PIPE market this week.

HQ Maritime sold 8% convertible promissory notes due Jan. 25, 2008. The notes are convertible into common shares at $0.30 each. The investors received one class A warrant and one class B warrant for every two shares issuable upon conversion. The class A warrants are exercisable at $0.35 each through Jan. 25, 2009, and the class B warrants are exercisable at $0.40 each through Jan. 25, 2011.

After the deal was announced Thursday morning, the company's stock slipped 7.91%, or 3 cents, to end at $0.32 (OTCBB: HQSM).

Proceeds will be used for marketing its nontoxic products to retail outlets in the United States.

"We are extremely pleased to receive this financing from such an important group of accredited investors who understand the huge growth potential of the aqua-culture markets and HQ's capability of becoming the world market leader in zero-toxin production in this field," said Norbert Sporns, the company's CEO, in a statement. "Our strong branding, marketing and distribution initiatives in the United States are in place to capitalize on the U.S. market growth and increased consumer awareness of quality toxin-free food products."

Based in Seattle, HQ Maritime Industries develops nutraceutical products made from nontoxic aquatic materials.

Volume remains strong

In spite of better oil prices, the stock market responded well to a slate of positive earnings reports on Thursday, one market source said, making the PIPE market a bit more appealing to potential issuers.

"It's looking really good for us," he said. "Stocks are strong; there seems to be more demand for biotech deals. [It's a] solid day, I think."

The Dow Jones Industrial Average climbed 99.73 to end the day at 10,809.47, and the Nasdaq composite index gained 22.35 to close at 2,283. The Standard & Poor's 500 composite index settled up 9.15 at 1,273.83.

SouthernEra wraps C$9.41 million offering

SouthernEra Diamonds Inc. wrapped a C$9,410,400 stock offering with BHP Minerals Holdings Pty. Ltd. SouthernEra sold to BHP 15,684,000 shares at C$0.60 each.

The placement represents about 12% of SouthernEra's outstanding common shares as of Jan. 3.

Half of the proceeds will be used for exploration on the company's diamond and mineral properties.

The offering was conducted as part of an exploration option rights agreement between SouthernEra and BHP. Under the terms of the agreement, BHP has the right to explore certain of SouthernEra's properties in the Democratic Republic of Congo.

The pricing sent the company's stock up 17.39% on Thursday, or 8 cents, to close at C$0.54 (Toronto: SDM).

Based in Vancouver, B.C., SouthernEra is a diamond and mineral exploration company.

Elsewhere in the Canadian resources sector, Golden China Resources Corp. negotiated a C$12 million unit offering, despite a dip in gold prices Thursday.

Gold prices ended the day off $3.40 to close at $559.70 per ounce.

Golden China intends to sell up to 12,000 units at C$1,000 each.

The units include C$1,000 in principal of 11.5% senior secured convertible debentures, 500 shares and 500 warrants. The warrants are exercisable at C$0.42 each for three years. The two-year debentures are convertible into common shares at C$0.35.

A syndicate of placement agents led by Haywood Securities Inc. has an over-allotment option for up to 3,000 additional units.

Proceeds will be used to meet the company's commitment under a business combination agreement with Michelago Ltd., including a loan to Michelago for $9.2 million. The rest of the proceeds will be used for working capital and general corporate purposes.

The company's stock gained 5.45%, or C$0.015, to close at C$0.29 (TSX Venture: AUC).

Based in Toronto, Golden China is a gold exploration and development company.

Carpathian raises C$1.85 million

Another gold explorer, Carpathian Gold Inc., settled a C$1,849,950 private placement of 12,333,000 units.

The units, comprised of one share and one warrant, were priced at C$0.15 each. The warrants are exercisable at C$0.20 each for two years.

Proceeds will be used for exploration on the company's Rovina license in Romania.

The company's stock remained unchanged Thursday at C$0.19 (TSX Venture: CPN).

Toronto-based Carpathian is a gold and copper exploration company focused on properties in Romania and Hungary.

NexMed stock loses 4%

NexMed, Inc.'s stock fell 4% on Thursday after wrapping an $8,319,000 private placement on Wednesday.

The company's stock dipped 4 cents to end at $0.96 Thursday (Nasdaq: NEXM). On Wednesday, when the deal closed, the company's stock gained 11.11%.

In the placement, the company issued shares at $0.89 each to a group of institutional and accredited investors led by Southpoint Capital Advisors LP and Loeb Partners Corp.

Based in Robbinsville, N.J., NexMed is a drug development company focused on treatments for nail fungus, sexual disorders and other ailments.

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