Atlas Energy cancels $24.76 million private stock placement

By Kenneth Lim

Boston, April 18 - Atlas Energy Resources, LLC canceled a planned $24.756 million private placement and a public stock offering following the disclosure of substantial losses from its hedge positions.

Atlas Energy said it expects to recognize a net loss of about $112 million in its accumulated other comprehensive loss at the end of March 2008, compared to a net loss of $5 million at the end of 2007.

"The recognition of these incremental hedge liabilities are the result of recent increases in reference prices for natural gas and oil," Atlas Energy said in a statement.

The company said it decided to scrap the stock offerings "to allow investors sufficient time to become aware" of the losses.

Atlas Energy had planned to issue 600,000 shares of its common stock to its parent, Atlas America Inc., at $41.26 per share. That price was Atlas Energy's closing stock price on April 17.

Atlas Energy also called off its public offering of 1.6 million common shares. UBS Investment Bank and Wachovia Securities were the bookrunners of the public offering.

Proceeds of the stock sales were to be used for repaying Atlas Energy's outstanding debt under an $850 million senior secured revolver, to create additional borrowing capacity for acreage acquisitions and to develop its properties.

Atlas Energy is a Moon Township, Pa.-based producer of natural gas on properties.

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