Willbros seals $52 million stock offering; Critical Therapeutics wraps $20 million direct stock deal

By Sheri Kasprzak

New York, Oct. 27 - PIPE volume remained relatively high to round out the week despite a dip in stocks. Willbros Group, Inc. led activity with the completion of a $52,113,040 stock offering.

In the broader market, one sellsider said one day of drops in the stock market will not impact volume at this point.

"It's a combination of things," he said. "For one thing, we're edging close to the end of the year and that means more deals anyway. Everyone wants to get things on the books before the year closes.

"And stocks are at record highs. It's a good time to be in the business."

After hitting all-time highs this week, the Dow Jones Industrial Average took a hit Friday, losing 73.40 to settle at 12,090.26. The Nasdaq composite index gave up 28.48 to close at 2,350.62 and the Standard & Poor's 500 composite index slipped by 11.74 to end at 1,377.34.

Looking to the Willbros offering, the company sold 3,722,360 shares at $14.00 each, a 10.6% discount to the company's $15.66 closing stock price on Thursday.

The institutional investors who participated in the deal received warrants for 558,354 shares, exercisable at $19.03 each.

The placement sent the company's stock down 4.28%, or 67 cents, to close at $14.99 (NYSE: WG).

The investors in the deal include Highbridge International LLC; Steelhead Investments Ltd.; Ramius Master Fund, Ltd.; Portside Growth and Opportunity Fund; Suttonbrook Capital Portfolio, LP; UBS O'Connor LLC fbo O'Connor PIPES Corporate Strategies Master Ltd.; Berggruen Holdings North America Ltd.; GLG Ventures International; Lorimor Corp.; Fort Mason Master, LP; Whitebox Advisors Convertible Arbitrage Advisors LP; UBS O'Connor LLC fbo O'Connor Global Convertible Arbitrage Master Ltd.; Hudson Bay Fund LP; Ramius Fund III, Ltd.; RCG Halifax Fund, Ltd.; Pandora Select Partners LP; RCG Equity Market Neutral Master Fund, Ltd.; UBS O'Connor LLC fbo O'Connor Global Convertible Arbitrage II Master Ltd.; and Fort Mason Partners, LP.

Proceeds will be used for general corporate purposes.

Houston-based Willbros provides services to the oil, gas and power industries, including construction and engineering services.

Critical Therapeutics' deal

Moving to the biotech sector, which was particularly active this week, Critical Therapeutics, Inc. said it plans to settle a $20 million offering of registered stock.

The offering comes on the heels of news that the company will cut 63 jobs - roughly half of its workforce - and take a related fourth-quarter charge of $3 million to $4 million as part of a plan to focus resources on its asthma drug Zileuton CR, a controlled-release formulation of its flagship asthma drug Zyflo.

In the placement, a group of institutional investors agreed to buy 7,455,731 units at $2.6825 each.

The units include one share and one half-share warrant with each whole warrant exercisable at $2.62 each through Oct. 26, 2011.

The shares will be sold under the company's shelf registration.

Lazard Capital Markets LLC is the placement agent for the deal.

"The CEO is completely restructuring the company," said one sellside trader. "The PIPE funding is part of that."

Referring to a decline in the stock Friday, he added: "This might be a problem in the short-run but it improves the company's chances of surviving."

The company's stock gave up 12.41%, or 34 cents, to settle at $2.38 (Nasdaq: CRTX). Volume of the company's shares traded Friday took off with 139,038 shares traded compared with the average 74,772 shares.

Proceeds will be used to fund the Food and Drug Administration's approval of the company's launch of Zileuton, Critical's product for asthma. The rest will be used for general corporate purposes.

Based in Lexington, Mass., Critical develops and commercializes treatments for respiratory and inflammatory diseases.

Another biotech offering

In other biotech news, Callisto Pharmaceuticals, Inc. concluded a $1.05 million offering of series A convertible preferred .

The company sold 105,000 shares of the preferreds at $10.00 each.

The preferreds are convertible into 1.4 million common shares at $0.75 each.

The investors received warrants for 1.4 million shares, exercisable at $0.75 each for five years.

Proceeds will be used to fund ongoing clinical development activities.

On Friday, Callisto's stock remained unchanged at $0.82 (Amex: KAL).

New York-based Callisto develops treatments for cancer and other serious diseases.

Elsewhere, Auxilio, Inc. sealed up a $1.5 million 12% line of credit with Cambria Investment Fund, LP.

The loan is due Oct. 22, 2007 and the investor will receive warrants for 750,000 shares, exercisable at $0.46 each.

Auxilio's stock fell by 8%, or 4 cents, to settle at $0.46 (OTCBB: AUXO) Friday.

Located in Mission Viejo, Calif., Auxilio provides document image management services for healthcare facilities.

Orleans negotiates PIPE

As oil prices continued to climb for the second-straight session, Orleans Energy Ltd. priced a private placement for up to C$15,122,500.

News of the placement sent the company's stock down 10 cents, or 2.22%, to close at C$4.40 (TSX Venture: OEX).

Meanwhile, oil prices advanced by 31 cents to close out the week at $60.75 per barrel.

The offering includes up to 2.63 million flow-through shares at C$5.75 apiece.

The deal is being placed through a syndicate of underwriters led by Peters & Co., Ltd.

Proceeds will be used for Canadian exploration expenses before Dec. 31, 2007.

The deal is set to close Nov. 14.

Calgary, Alta.-based Orleans is an oil and natural gas exploration company.

Ronda Fears contributed to this report.

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