Extra Space Storage raises $83.51 million in private placement; volume holds steady despite mixed stocks

By Sheri Kasprzak

Atlanta, June 21 - Extra Space Storage Inc. led private placement news Tuesday with the closing of its $83,514,000 offering, as volume remained solid.

Salt Lake City-based Extra Space received agreements for 6.2 million shares at $13.47 each.

One market source who saw the deal said he felt the pricing was "right in line."

"I'm not particularly familiar with this industry or the company, but from what I can tell, just looking at yesterday's closing stock, it looks fine," the source said.

After the offering was announced Tuesday morning, Extra Space's stock added $0.34 to close at $14.14.

The company plans to use the proceeds to partially fund the acquisition of a portfolio of self-storage properties from Storage USA. The remainder will be used for general corporate purposes.

Extra Space operates self-storage facilities.

In the broad private placement market, sell-siders said volume remained strong, fueled by strong investor demand for sectors like oil and minerals.

"I'd say more small things, in terms of what's out there," said one sell-sider. "But overall, the market is stronger than it has been in several weeks, in terms of volume. Almost everything I've seen today is natural resources, so that's a strong sector right now."

Several mineral, gold and oil exploration companies announced either new deals or closed deals Tuesday. Among them were offerings from Tyner Resources Ltd., an oil exploration company pricing a C$11.52 million deal and Gastar Exploration Inc., which announced that it is gearing up to close a C$21.24 million private placement. Another oil exploration company, Avery Resources Inc., priced a C$2 million offering of units Tuesday.

Oil slipped Tuesday, but remained near $60 per barrel. Oil priced dropped $0.47 to close at $58.90 per barrel.

Meanwhile, stocks closed mixed with the Dow Jones Industrial Average down 9.44 to close at 10,599.67; the Nasdaq composite index up 2.94 at 2,091.07 and the S&P 500 down 2.49 at 1,213.61.

Critical Therapeutics raises $54.3 million

Moving to the biopharmaceutical industry, another sector that has seen several new offerings this week and last week, Critical Therapeutics, Inc. finished a $54,252,000 offering.

The company issued 9.9 million shares at $5.48 each to institutional investors, which also received warrants for 3.5 million shares.

The warrants are exercisable at $6.58 each.

Lehman Brothers Inc. and Deutsche Bank Securities Inc. were the placement agents in the offering.

"In addition to strengthening our balance sheet, this financing supports the launch of our first commercial product Zyflor Filmtab in the fourth quarter of 205, pending regulatory approval of our supplemental New Drug Application and allows us to further the clinical and pre-clinical development of our product candidates," said Frank Thomas, the company's chief financial officer, in a statement. "Based on our current operating plans, we believe the proceeds from the private placement, together with our existing cash balance, will provide us with adequate capital for at least the next two years."

After the subscriptions were announced Tuesday morning, the company's stock gained $0.68, or 11.15%, to close at $6.78.

Based in Lexington, Mass., Critical Therapeutics is a biopharmaceutical company focused on treatments for respiratory diseases. The proceeds will be used to launch an investigational asthma drug, to further the clinical and pre-clinical developments of its other drug candidates and expand its drug discovery and development initiatives. The remainder will be used for general corporate purposes.

Gastar gets C$21.24 million

Back to oil, Gastar Exploration, a Houston-based oil exploration company, said it has raised C$21,242,709 so far in a private placement.

The company has sold 6,417,737 shares at C$3.31 each in a deal it had announced June 10 as a C$22 million offering comprised of 6,646,526 shares.

The investors have an option to buy an additional 1,510,575 shares at the same price for one week.

"We are pleased by the capital market response to our recent financings," said J. Russell Porter, the company's chief executive officer, in a statement. "The completion of these financings and the acquisition of the additional interests in our East Texas and Power River Basin properties provide Gastar with a focused operational plan moving forward and the ability to create significant value for our shareholders."

Based in Houston, Gastar is an oil exploration company. The proceeds will be used for the company's drilling program in East Texas and for general corporate purposes.

It recently completed the sale of $63 million of notes.

Gastar's stock closed down C$0.14, or 3.9%, to close at C$3.45 Tuesday.

Route1 wraps C$4 million deal

Toronto-based wireless technology provider Route1 Inc. completed a C$4 million private placement of units, the company said Tuesday.

The offering included 13,333,335 units at C$0.30 each.

The units are comprised of one share and one half-share warrant. The full warrants allow for an additional share at C$0.40 each for 18 months.

The deal was announced Tuesday morning and the company's stock gained C$0.02, or 5%, to close at C$0.42.

"We are very excited about the level of interest we have received from investors and our employees," said John Denham, the company's vice president of finance and chief financial officer, in a statement.

"We're also pleased with the speed with which we were able to secure this funding, which has allowed us to focus our collective energies on our product rollout and prospective customers."

The proceeds will be used for general corporate purposes and working capital for marketing and distributing its Mobi Solution product, a remote computing device.

Entrée Gold's stock dips

A day after announcing its plans to raise up to C$13,875,226 in a private placement, Entrée Gold Inc.'s stock dropped.

The company's stock lost C$0.20, or 8.33%, to close at C$2.20 Tuesday.

When the offering was first announced Monday, the company's stock rose C$0.29, or 13.74%, to close at C$2.40.

The Vancouver, B.C.-based Entrée plans to sell units at C$2.20 each.

Entrée is a gold exploration company.

Mikohn Gaming's stock closes down

After proposing a $40 million private placement late last week, Mikohn Gaming Corp.'s stock dipped Tuesday.

The company's stock slid $0.23, or 1.48%, to close at $15.30.

On Monday, the company's stock rose $0.33 to close at $15.53 and on Friday, when the deal was first announced, the company's stock dropped $0.38 to close at $15.20.

The company plans to sell convertible notes with a conversion price set at $12.19 each.

Las Vegas-based Mikohn develops products used in the gaming industry.

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