Colt, Bio-Bridge, Mid-States raise capital; Penn National receives $1.25 billion on scrapped deal

By Kenneth Lim

Boston, July 3 - Colt Resources Inc. said it is raising a critical C$5 million - despite a challenging market - to fund its needs for the next two years.

Penn National Gaming, Inc. said it sold $1.25 billion worth of preferred equity following the cancellation of a planned acquisition by a consortium of funds.

Bio-Bridge Science, Inc. raised $2.78 million to fund the development of a product, while Mid-States plc gave its working capital a £1.12 million boost.

Colt raises for two years

Colt Resources said it is selling C$5 million of units in a non-brokered private placement.

The company will sell 20 million units at C$0.25 apiece. Each unit comprises one common share and one three-year warrant exercisable at C$0.30. Colt common stock (CNQ: COLT) closed at C$0.22 on Thursday, up by 10% or C$0.02.

Colt, a junior mineral exploration company based in Vancouver, B.C., said it will use the proceeds for exploration expenditures at its Portugal property and for general working capital.

"This is a very important exercise for us," Colt president and chief executive Bedo H. Kalpakian told Prospect News. "We will be using it in the exploration expenditures on our Portuguese property, which is basically gold and base metals. Those base metals are tungsten, lead, zinc and silver. We need the funds in order to do the exploration work program."

Kalpakian said he was not satisfied with the pricing of the deal, but he will take what he can get.

"The market conditions being what they are right now, we have to be realistic," he said.

Colt expects the new capital to last for about two years, Kalpakian said.

"If we are able to raise the C$5 million, we won't be in the market for at least another 24 months," he said.

Penn National receives $1.25 billion

Penn National said it received $1.25 billion from an issuance of preferred stock due June 2015 as part of the cancellation of its planned acquisition by a consortium of funds.

The preferred stock, which will receive dividends based on the common dividend rate, will be redeemed at maturity.

Penn National common stock (Nasdaq: PENN) gained 3.71% or $1.06 to close at $29.66 on Thursday.

The preferreds were sold to affiliates of Fortress Investment Group LLC, Centerbridge Partners LP, Wachovia and Deutsche Bank. Fortress and Centerbridge were the funds that had been planning to acquire Penn.

Penn, a Wyomissing, Pa.-based gaming and racing company, said the proceeds will be used to repay existing debt, to acquire or develop gaming facilities and for other uses.

Penn said in a statement Thursday that the acquisition was called off because the company and its directors thought that the "proposed merger transaction would not be completed without significant and lengthy litigation which is inherently unpredictable. Further, it also became apparent to the company and its board that a re-negotiated, reduced purchase price was not a viable option."

"We are extremely disappointed that the company's shareholders will not receive the $67 per share merger consideration," Penn chief executive Peter M. Carlino said in the statement.

"Our decision to enter into the agreements announced today follows a thorough evaluation of a wide range of alternatives for consummating the transaction. The prospect of employing litigation to enforce performance of the merger agreement would inherently expose the company to the significant risk related to a protracted legal process. We may be in the gaming business, but we would never gamble the company's future and our shareholders' best interest in this or any other circumstance."

"This transaction represents the company's best alternative to the uncertainty of litigation and delivers immediate tangible and material value to our stockholders," Carlino further stated. "Importantly, we are confident that we can very effectively deploy this capital to generate significant value for our stockholders based on our well established track record of delivering long-term growth through a focus on return on investment and disciplined financial and risk management.

"In this regard, we believe the substantial capital infusion will enable Penn National to be aggressively opportunistic at a time when gaming industry valuations appear very attractive," Carlino added.

"Our ability to structure and integrate accretive, strategic acquisitions has been an important driver of Penn National's long-term financial growth and any such future activity would complement our current operations - including our recently opened facilities in Pennsylvania and Maine - and staggered pipeline of announced development projects including those in Indiana and Kansas."

Bio-Bridge sells units

Bio-Bridge Science raised $2.78 million from two recent placements of stock and warrant units.

On July 2, the company sold about 3.4 million units of one common share and one half-share warrant at $0.725 per unit to NFR International Pty Ltd. and China Diamond Ltd., companies controlled by Bio-Bridge director Trevor Roy. Each five-year warrant is exercisable at $1.10.

Bio-Bridge common stock (OTCBB: BGES) closed unchanged at $1.75 on Thursday.

The company also sold 366,667 of a separate series of units at $0.75 to four investors in June. Each unit consists of one common share, a three-year half-share warrant exercisable at $0.75 and a five-year half-share warrant exercisable at $1.20.

Proceeds will be used for general working capital purpose and to fund the company's vaccine development activities in China

Oak Brook, Ill.-based Bio-Bridge develops treatments for infectious diseases.

"We are happy to see our investors strongly support our company and have confidence in our business and strategy," Oak Brook chairman and chief executive Liang Qiao said in a statement. "We will see significant business development in both our core business in vaccine development and acquisition/joint venture. We are optimistic that our shareholder value can be maximized through our continuous hard work. "

Mid-States boosts working capital

Mid-States said it sold £1.12 million worth of shares through a private placement.

The 6.97 million shares in the deal were issued at 16p apiece. Mid-States common stock (AIM: MST) closed at 16.5p on Thursday, lower by 2.94% or 0.5p.

Mid-States, an environmental technology company based in London, said proceeds will be used for working capital. One of Mid-States' flagship products is the AD, an air disinfection technology.

"The company has made good progress recently with the distribution agreements with Sunlight in the UK and Aerosan in Ireland," Mid-States chairman David Plucinsky said in a statement. "These funds will allow the company to invest in further penetration of the market for the AD in the UK, in Ireland, and Europe."

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