Ener1 gets $65 million equity infusion; Quantum brings two deals; NeuLion plans preferred sale

By Stephanie N. Rotondo

Portland, Ore., June 1 - Several energy and mining companies came to the PIPE market Tuesday looking for funding.

Ener1 Inc. will receive $65 million from a private equity infusion. The investor is the company's largest shareholder, Ener1 Group. The funding will be used with those received from a government program to ramp up production.

Quantum Solar Power Corp., another alternative energy company, announced two $5 million private placements of stock. The company will conduct the financings both domestically and abroad.

Meanwhile, NeuLion Inc. said it had negotiated a $10 million private placement of convertible preferred shares. The company will sell the shares at a premium to its closing price as of May 28.

Argentex Mining Corp. will raise more than C$7 million via a private placement of units. IFC is the sole investor and the investment is the largest in the company's history, according to a press release.

Ur-Energy Inc. closed on a C$5 million private placement of shares. Blackrock Inc. is the sole investor.

And, Canadian Spirit Resources Inc. will issue flow-through shares in its effort to raise C$4.2 million. The funding will be used for exploration and exploration-related activities.

Ener1 gets equity infusion

Ener1, a Fort Lauderdale, Fla.-based alternative energy technology company, will take in $65 million from a private placement of stock.

The deal's investor is the company's principal shareholder, Ener1 Group.

The company will issue approximately 18.68 million common shares - along with 8 million warrants - to the investor. The warrants are exercisable for five years, with 3 million being exercisable at $3.48 and 5 million at $4.40.

"The commitment of new capital from Ener1 Group is another strong vote of confidence from our most significant shareholder," said Charles Gassenheimer, chairman and chief executive officer, in a press release. "Even in this difficult capital markets environment, Ener1 has a compelling growth story that is clearly able to attract the type of long-term private equity capital needed to scale our business. Further evidence of this ability is reflected by our ongoing discussions with one of our significant shareholders to increase their investment in Ener1 to a level necessary to achieve positive cash flow."

"It is clear to see that technological innovation, particularly in the energy field, will be a key driver for economic development in the 21st century," added Boris G. Zingarevich, the Russian founder of Ener1 Group. "Thanks to new possibilities in energy storage, transportation electrification and smart grids are two developments happening now that will change economies and society in many positive ways."

The private placement investment is in addition to funds received under the U.S. Energy Department's Advanced Battery Manufacturing Initiative. Those funds will be used to ramp up production of electric vehicle battery packs at the company's subsidiary, EnerDel Inc. Once production is increased - up to 900 battery packs per month - Ener1 expects to post break-even EBITDA.

Last week, the company announced a joint venture with Wanxiang Corp., the largest tier-one supplier to the Chinese auto industry. This joint venture is expected to provide Ener1 with access to such potential Chinese customers as SAIC, Chana, Haima, Guangzhou and Yutong, the world's second-largest bus maker.

Ener1's equity (Amex: HEV) gained 24 cents, or 6.9%, to $3.72. Market capitalization is $481 million.

Quantum brings two deals

Quantum Solar announced two private placements of stock - one foreign and one domestic - which will generate proceeds up to $10 million.

The company will sell 10 million common shares at $1.00 each, with half going to U.S. investors and the other half to foreign investors.

"The timing is right," said Daryl Ehrmantraut, president and CEO, in an interview with Prospect News. "When we look at the technology coming out of our labs, we're pretty much set to go to market with this now."

The funding will "provide us with the financing needed to do a company rollout," he added, which includes the company's "significant expansion plan" and "going from a development stage company to a company commercializing technology, which is likely to have a profound effect on the way solar power will be produced in the future."

He said he "felt the private placement approach would probably fill our needs," and that it was "more suitable for the stage the company is at right now."

Quantum's stock (OTCBB: QSPW) was steady at $2.50. Market capitalization is $355 million.

Quantum Solar Power is a Santa Fe, N.M.-based manufacturer of solar energy products.

NeuLion plans preferred sale

Plainview, N.Y.-based NeuLion is seeking $10 million via a private placement of 8% series A convertible preferred stock, according to a press release.

The company will sell the shares at C$0.60 each. The price per share represents a 28% premium over the closing price as of May 28.

Proceeds will be used for general corporate purposes.

Calls seeking further comment were not returned Tuesday.

NeuLion's shares (Toronto: NLN) increased 2 cents, or 3.45%, to C$0.45. Market capitalization is C$58.4 million.

NeuLion is a provider of internet-streamed television.

Argentex to sell stock to IFC

Argentex Mining will sell C$7.35 million units in a private placement, the company said in a press release.

IFC, a member of World Bank Group, is the investor.

The Toronto-based company will issue approximately 9.18 million of the units at C$0.80 per unit. Each unit will hold one common share and one warrant, which is exercisable at C$1.34 for five years.

"We look forward to having an experienced investor such as IFC make the largest single investment in our company's history," said Ken Hicks, president of Argentex, in the release. "IFC is a long term investor with an impressive track record of making successful equity investments in developing countries. Their value-added business approach to investment as well as their confidence in both the Argentex organization and our properties is very positive."

Proceeds will be used for exploration and pre-feasibility work, as well as for working capital and general corporate purposes. Settlement is expected by July 31.

Argentex's equity (TSX Venture: ATX) improved by 2 cents, or 2.47%, to C$0.83. Market capitalization is C$36.9 million.

Ur-Energy takes in C$5 million

Ur-Energy wrapped a C$5 million private placement of equity, the company announced.

Blackrock Inc. was the investor.

The Denver-based uranium exploration company sold 5 million common shares at C$1.00 each.

"Blackrock has been our largest shareholder since 2005, prior to our IPO, and has been a solid supporter of the company since that time," remarked Jeffrey Klenda, chairman, in a press release. "We are extremely pleased with Blackrock's desire to increase its holdings to this extent. It clearly demonstrates their ongoing commitment to Ur-Energy's success."

"We continue to be well funded with [C]$38.5 million as current cash resources as of March 31, 2010," added Bill Boberg, president and CEO. "We believe this is sufficient cash to get our Lost Creek Project into production after receiving the final necessary licenses in upcoming months. While our current guidance for receipt of all final permits and licenses continues to be this summer, various regulatory delays over the past couple of years created a funding gap before first cash flow. Blackrock's continuing support of Ur-Energy is most appreciated."

Ur-Energy's shares (Toronto: URE) firmed a cent, or 1.04%, to C$0.97. Market capitalization is C$91.1 million.

Canadian Spirit seeks drill dollars

Canadian Spirit Resources arranged a C$4.2 million private placement of flow-through shares, according to a press release.

The company will sell 3 million of the shares at C$1.40 per share in the non-brokered placement.

"Proceeds of the proposed private placement will be used to fund the corporation's planned 2010 drilling program in the Montney Formation at Farrell Creek, British Columbia in conjunction with its joint venture partner Canbriam Energy BC Partnership," Canadian Spirit said in the release. "This program, commencing in early June, is expected to include the drilling of three horizontal wells targeting the upper portion of the Montney Formation and the fracture stimulation of a lower Montney horizontal well drilled in the first quarter of 2010."

Settlement is expected by June 25.

Canadian Spirit's stock (TSX Venture: SPI) fell 9 cents, or 7.26%, to C$1.15. Market capitalization is C$60 million.

Canadian Spirit Resources is a Calgary, Alta.-based natural gas company.

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