Private placements remain strong as stocks, oil rise; CV Therapeutics raises $25 million

By Sheri Kasprzak

Atlanta, Feb. 4 - Private placement volume continued to ride high on improved stocks, slightly better oil prices and mergers and acquisitions.

"Obviously, mergers, as I've mentioned before, are a big part of volume right now," said one market source. "The stock market made some pretty serious gains today and that is contributing as well."

The Dow Jones Industrial Average jumped 123.03 Friday to end at 10,716.13; the Nasdaq composite index gained 29.02 to close at 2,086.66 and the S&P 500 closed 13.14 higher at 1,203.03.

Oil prices also made slight gains Friday and, according to some market sources, that may be responsible for a few issues.

Oil edged up $0.03 to close at $46.48 per barrel.

Strong gold and minerals stocks may have also pushed volume in Canada, sources there said.

Messing Minerals Inc. said it plans to raise C$2.85 million in a private placement and Midway Gold Corp. announced its plans to raise C$2.12 million.

Leading private placement action in the United States, CV Therapeutics Inc. said it received $25,000,108 as part of an equity agreement with Acqua Wellington North American Equities Fund Ltd.

The company sold 1,275,711 shares at $19.597 each to Acqua Wellington in a direct placement.

CV Therapeutics and Acqua Wellington entered into an equity agreement July 3, 2003, in which Acqua will purchase up to $100 million in shares over 28 months.

Following the announcement of the closing, the company's stock jumped $0.95 to end at $22.42.

On Dec. 23, the company sold 914,985 shares at $21.8583 each for $20 million under the agreement.

The shares in the both transactions were sold under CV Therapeutics' shelf registration.

Reedland Capital Partners is the placement agent in the transaction.

CV Therapeutics, based in Palo Alto, Calif., develops drugs to treat certain types of cancers. The company plans to use the proceeds from the offering for research, development, product manufacturing, clinical trial development, the preparation of new drug applications, reducing indebtedness and making acquisition in complimentary businesses or technologies. The remainder of the funds will be used for working capital and capital expenditures.

Active Power raises $19.85 million

Active Power, Inc. said it has closed a private placement for $19,854,416.

The company sold 5,454,510 shares at $3.64 each to institutional investors.

The agreement also included additional investment rights for up to 1,636,353 shares at $3.64 each for an additional $6 million.

RBC Capital Markets was the placement agent.

"This transaction will provide us with additional resources to pursue new markets," said Active's chief executive officer Joe Pinkerton in a statement. "In particular, capital raised will allow use to expedite the commercialization of our new extended runtime product, CleanSource XR, which will target large opportunities within the telecom and midrange UPS markets."

Based in Austin, Texas, Active Power designs, manufactures and markets battery-free backup power products. The proceeds from the private placement will be used for general corporate purposes, including growth.

On Friday, Active Power's stock closed down $0.22 at $3.84.

Leader upsizes deal

For the second time, Leader Energy Services Ltd. upsized its previously announced C$5 million private placement. The company now plans to raise C$10 million.

The upsized offering includes up to 8 million units at C$1.25 each. The units include one share and one half-share warrant.

The whole warrants allow for an additional share at C$1.70 each for two years.

The deal was first announced Dec. 1 as a C$5 million offering of up to 4 million units at C$1.25 each. On Jan. 28, the offering was upsized to C$7.25 million, or 5.8 million units at C$1.25 each.

Research Capital Corp. is the placement agent.

Based in Calgary, Alta., Leader provides field services for oil and gas well stimulation. The company plans to use the proceeds from the offering for the purchase of one deep-coiled tubing unit, two nitrogen pumper units, two nitrogen bulker units and for working capital.

On Friday, Leader's stock lost $0.05 to close at $1.50.

Big Sky plans $7 million offering

Big Sky Energy Corp. announced its plans to head to the private placement market with a $7 million offering.

The deal includes up to 14 million shares at $0.50 each.

"It looks good to me," said one sell-side market source familiar with the deal. "Only about a 9% discount. It has a lot to do with the oil market right now. Oil started making some gains today. I think you can expect it to go well."

Big Sky is an oil and gas exploration and production company based in Beijing, China.

Madison closes C$2.37 million deal

Madison Minerals Inc. finished the final tranche of a private placement totaling C$2,375,815 Friday.

The company sold a total of 3,655,100 units at C$0.65 each.

The units are comprised of one share and one warrant. The warrants allow for an additional share at C$0.90 each for 18 months.

The first tranche closed Dec. 9, 2004 for 1,056,000 units and the second tranche closed Feb. 3 for 2,599,100 units.

"From what I can tell, the market is responding well to it," said one market source. "The warrants are a great deal for them."

The source said that natural resources markets remain strong and that may have contributed to the pricing of this deal.

Following the announcement of the closing, Madison's stock gained C$0.06 to close at C$0.68.

Canaccord Capital Corp. was the placement agent in the offering.

Madison is a Vancouver, B.C.-based mineral exploration company. It plans to use the proceeds from the private placement for exploration on its Mt. Kare property in Papua, New Guinea.

ACT continues to make gains

Two days after announcing its $14 million private placement of a convertible notes, ACT Teleconferencing Inc.'s stocks continued to make gains.

The company's stock gained $0.06 to close at $0.90 Friday. That followed a gain of $0.14 on Thursday.

The note is convertible into common shares at $1.05 each.

ACT is an audio, video and web-based conferencing products and services company in Golden, Colo.

Basic Empire's stock rises

After announcing a merger with China Tailong Holdings Co., Ltd. and the closing of a $1 million private placement, Basic Empire Corp.'s stock continued to make gains.

The company's stock ended $0.45 higher Friday at $3.95.

Immediately after the merger was announced, the company's stock skyrocketed $3.40.

Basic Empire's stock was trading at $0.10 on Feb. 2, just a day before the merger.

In the merger, 10,606,158 shares of Basic Empire were issued to Tailong's stockholders, representing 90% of the company's issued and outstanding shares.

Based in Midland, Texas, Basic Empire will now manufacture compound liquid fertilizer products.

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