Lexicon sells stock to Invus; Synergy Resources wraps convertibles sale; Polar Star lifts deal

By Stephanie N. Rotondo

Portland, Ore., March 16 - U.S.-based issuers brought Tuesday's biggest PIPE deals, but it was Canadian companies that dominated the financing arena.

Lexicon Pharmaceuticals Inc. said it had negotiated a private placement of stock with an existing shareholder. The $68 million-plus deal is being done in conjunction with a public offering.

Elsewhere, Synergy Resources Corp. said it had completed an $18 million private placement of units. The units contained a convertible promissory note and warrants.

Among Canadian issuers, Polar Star Mining Corp. announced it had increased the size of a previously announced private placement of common stock. According to a company spokesperson, the upsizing was due to investor demand.

Triton Energy Corp. aims to raise C$7.5 million via a private placement of equity. The company intends to use the funds for its capital programs.

And, Eaglecrest Explorations Ltd. announced a C$6 million placement of units. Proceeds from that financing will be used for exploration.

Lexicon sells shares to Invus

Lexicon Pharmaceuticals will take in $68.19 million via a private placement of equity, according to a regulatory filing and subsequent press release.

Invus LP, an existing shareholder, is the investor. Invus' participation in the deal will allow the investor to "maintain its pro rata ownership of Lexicon's common stock," Arthur Sands, president and chief executive officer, told Prospect News.

Lexicon will sell approximately 59.29 million common shares to Invus at $1.15 each.

Additionally, Lexicon priced a follow-on public offering of shares at the same terms as the private placement. The company will sell approximately 87.71 million shares, for total approximate proceeds of $100.86 million.

According to Sands, the deal came about as Lexicon "initiated a follow-on offering" for about $95 million. The company also sought to allow Invus to exercise its right to maintain its stake by negotiating a $63 million placement.

"We raised the total capital raise that we set out to, in fact slightly over," he said.

Sands also said that both the financings "came about because of Lexicon's desire to raise capital to dedicate it towards our four drug development programs."

And, while he acknowledged that the financings were a "dilutive event...we balanced the priorities between equity dilution and potential partnership dilution."

Lexicon's stock (Nasdaq: LXRX) dropped 15 cents, or 9.15%, to $1.29. Market capitalization is $220 million.

Lexicon Pharmaceuticals is based in The Woodlands, Texas.

Synergy wraps convertible unit sale

Synergy Resources pocketed $18 million from a private placement of convertible units, the company said in a press release.

The multi-tranche deal closed March 12. The company raised $4.17 million on Dec. 29 and $12.06 million on March 4.

The financing was oversubscribed.

A total of 180 units were issued. The units included one $100,000 8% convertible promissory note due Dec. 31, 2012 and 50,000 warrants.

The notes are initially convertible into common shares at $1.60 per share and the warrants are exercisable at $6.00 until Dec. 31, 2014.

"We are pleased with the response to our private placement offering and pleased that [placement agent] GVC Capital was able to exercise the $3,000,000 over-allotment option," remarked Ed Holloway, chairman, in the release.

"The proceeds will provide the capital to complete the wells drilled in Synergy's 2010 drilling program and to continue to take advantage of many of the compelling opportunities that exist in the D-J Basin."

Synergy's shares (OTCBB: SYRG) ended steady at $3.50. Market capitalization is $42 million.

Synergy Resources is a Platteville, Colo.-based oil and gas company.

Polar Star lifts deal

Polar Star Mining increased a previously announced private placement of common shares to C$13.5 million from C$10 million.

The deal originally priced on March 2 and included a 15% greenshoe. The company said that the placement agent has exercised the over-allotment option, which could result in total proceeds of C$15 million.

The company will issue the shares at C$1.10 each.

David Speck, vice president of Polar Star, said in the increase in the financing was due to "just demand" for the shares.

"We are trying to keep aware of the degree of dilution, but we are simply responding to investors that want to have some ownership in Polar Star," he said in an interview with Prospect News.

Speck also noted that he was "very pleased with the support" received from investors. "It's a very strong show of support for what we are doing."

Proceeds will be used for exploration programs in Chile, as well as for general corporate purposes. Settlement is expected by March 18.

Polar Star's equity (TSX Venture: PSR) gained 3 cents, or 2.59%, to C$1.19. Market capitalization is C$84.5 million.

Polar Star Mining is a Toronto-based emerging exploration company.

Triton to raise C$7.5 million

Triton Energy is seeking C$7.5 million via a private placement of equity.

The Calgary, Alta.-based oil and natural gas company will sell 34.1 million flow-through shares at C$0.22 each on a bought-deal basis.

Proceeds will go toward the company's capital expenditures program through 2011. Settlement is expected by March 31.

Triton's stock (TSX Venture: TEZ) dipped half a cent, or 2.50%, to C$0.195. Market capitalization is C$7.86 million.

Eaglecrest to issue units

Eaglecrest Explorations intends to raise C$6 million from a non-brokered private placement of units, according to a press release.

The company will issue 12 million units at C$0.50 each. The units will consist of one common share and one warrant. The warrants are exercisable at C$0.75 for two years.

Proceeds will be used for gold exploration activities in Bolivia and Colombia, as well as for general corporate purposes.

Eaglecrest's shares (TSX Venture: EEL) held in at C$0.55. Market capitalization is C$25.1 million.

Eaglecrest Explorations is a Vancouver, B.C.-based gold exploration company.

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