Linn Energy secures $260 million from unit sale; Greenlight pockets $50 million from PIPE

By Sheri Kasprzak

New York, May 30 - In an effort to pay off debt under its revolving credit line, Linn Energy, LLC said Wednesday it has secured agreements for a $260 million private placement.

A group of investors led by Lehman Brothers MLP Opportunity Fund LP plans to buy 7,761,194 common units at $33.50 each.

After the deal was announced Wednesday afternoon, the company's stock fell by 2% by 1:30 p.m. ET. At the end of the day, the stock had fallen 39 cents, or 1.06%, to close at $36.45 (Nasdaq: LINE).

Citigroup Global Markets Inc., Lehman Brothers Inc., RBC Capital Markets Corp. and Jefferies & Co., Inc. were the placement agents.

Proceeds will be used for debt repayment under the company's revolving credit facility.

The company also said Wednesday that it expects to increase to $765 million from $725 million its borrowing base under the credit facility connected to its pending acquisition of oil and gas properties in the Texas Panhandle.

"We continue to see a number of attractive bolt-on acquisition targets in our core areas and this offering positions us to take advantage of those opportunities," said Michael Linn, the company's chief executive officer, in a news release.

In December 2006, Linn closed a $359,960,295 private placement as part of its acquisition of a private oil and gas company and properties in the Appalachian Basin.

In that deal, the company issued 6,650,144 units and 7,465,946 class C units at a blended price of $25.50 each to a group of institutional investors.

Houston-based Linn is an oil and natural gas exploration company.

In the broader market, a sellside market source said he feels activity this summer may be fueled a great deal by acquisitions and mergers.

"I really do believe that even now, a lot of what's out there is coming from M&A activity, and I would expect that to continue through the summer," he said. "On the downside, that probably means fewer offerings but on the upside, it means bigger offerings."

Greenlight raises $50 million

In other PIPE news Wednesday, Greenlight Capital Re, Ltd. concluded a $50 million private placement along with its $223,962,500 initial public offering.

The company issued 2,631,579 class B shares at $19.00 each in the private placement to David Einhorn, Greenlight's chairman.

In the IPO, the company issued 11,787,500 class A shares at the same price as the private placement, including a greenshoe for 1,537,500 shares exercised by underwriters Lehman Brothers Inc. and UBS Securities LLC.

Proceeds from the offerings will be used to increase the company's capacity of its reinsurance operations.

On Wednesday, the company's stock dipped 33 cents, or 1.37%, to close at $23.75 (Nasdaq: GLRE).

Based in Grand Cayman, Cayman Islands, Greenlight is a property and casualty reinsurance company.

Home System's offering

In another sizable deal wrapped recently, Home System Group, Inc. sealed a $40 million stock deal with a group of institutional investors.

The investors - Total Giant Group Ltd., Total Shine Group Ltd., Victory High Investments Ltd. and Think Big Trading Ltd. - bought the shares at $4.00 each. The share price was an 11% discount to the company's $4.50 closing stock price on Tuesday.

The investors paid 16.25% of the purchase price of the shares upon closing and the rest will be payable under the terms of a promissory note, due the earlier of two years from the issue date or within five days of a registration statement being filed with the Securities and Exchange Commission.

The company's stock remained unmoved at $4.50 Wednesday (OTCBB: HSYT).

Home System, based in Los Angeles, is a home appliances manufacturing company.

QPC pockets $10.6 million

Moving to the tech sector, QPC Lasers, Inc. sealed a $10.6 million offering of convertible debentures.

The deal is the second of two financing rounds, the first of which was closed in April for $8.2 million. The debentures sold in April have the same terms as the offering announced Wednesday.

The two-year debentures bear interest at 10% annually and are convertible into common shares at $1.05 each.

The investors also received warrants for 15.1 million shares, exercisable at $1.05 each for five years.

T.R. Winston & Co., LLC was the placement agent.

Proceeds will be used for marketing, operations and general corporate purposes.

"As we continue to execute our growth plan, we believe this financing will provide sufficient cash to support the increased manufacturing and inventory needs that coincide with the ramp in sales orders we have experienced, as well as support the launch of our generation-three lasers due out later this year," said George Lintz, the company's chief financial officer, in a statement.

"Inclusive of the financing we completed in April, we have raised a total of $16.9 million in the second quarter and we are confident the company now has adequate cash to support our growth and operations for at least the next 12 months."

QPC's stock gave up 3 cents to close at $1.15 Wednesday (OTCBB: QPCI).

Based in Sylmar, Calif., QPC develops and commercializes high-brightness, high-power semiconductor lasers used in the industrial, defense and medical sectors.

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