China Valves wraps $30 million stock sale; Wintrust to sell $50 million convertible preferreds

By Devika Patel

Knoxville, Tenn., Aug. 27 - China Valves Technology, Inc. secured a huge capital boost Wednesday after completing a $30 million private placement of shares with a group of investors led by Pinnacle China Fund, LP and The Pinnacle Fund, LP.

The manufacturer and distributor of metal valves, which primarily conducts its business in the People's Republic of China, hopes this deal could be its proverbial "foot in the door," giving it an opportunity to begin marketing its brands within the United States.

On a slightly smaller scale, Coro Mining Corp. said it settled a C$3 million tranche of a C$15 million private placement of units.

The deal is part of a larger fundraising effort with an investor with Dundee Global Resources LP, who also has agreed to provide Coro with an additional $25 million through a loan facility.

And after the close on Tuesday, Wintrust Financial Corp. announced the completion of a $50 million private placement of convertible preferreds with CIVC Partners.

China Valves sees $30 million

China Valves took a step forward Wednesday in announcing its recently completed $50 million private placement of shares, which will fund the metal valve manufacturing company's fiscal needs, including acquisitions and working capital, for some time as it prepares to go through a rather large shake-up.

In announcing the deal, the company said it will effect a 1-for-2 reverse split within 90 days following the closing of this transaction. China Valves has grown rapidly over the past few years and is readying itself to move forward at a time when many companies are preparing to scale back their operations.

"We are very pleased to have attracted the support of respected institutional investors in the U.S. capital markets," China Valves chairman and chief executive officer Siping Fang, who also is the chairman of the China Valve Industry Association, said in a press release. "Demand for large scale and high quality valves is growing at a rapid pace in China, driven by investments in power generation, water supplies and urban infrastructure.

"We believe China Valves' strong technology, manufacturing scale and brand recognition provide us with an attractive platform to take advantage of consolidation opportunities and build a national brand in this market," Fang concluded.

The company detailed the factors it believes led to its current success and also noted plans for moving forward, saying that the Chinese valve market was $5.4 billion in 2006 and is expected to grow at an annual rate of 30% over the next five years, based on research from the China Valve Industry Association.

The company said demand is particularly strong in the oil, power and water supply industries. The market is highly fragmented, and China Valves intends to expand its market share aggressively by further penetrating established segments, entering new segments and through strategic acquisitions.

In the private placement, the company sold 16,778,523 common shares at $1.788 per share to a group of investors led by Pinnacle China Fund, LP and The Pinnacle Fund, LP through lead placement agent Brean Murray, Carret & Co.

The Beverly Hills, Calif.-based company's shares (OTCBB: CVVT) remained indifferent to Thursday's news, closing unchanged at $5.00.

Coro to sell C$15 million

Vancouver, B.C.'s Coro Mining said it sealed a C$3 million tranche of its planned private placement of units with investor Dundee Global Resources LP. The total deal is slated to raise C$15 million, which will help Coro in its bid to acquire the Cerro Negro Copper Mine in Chile.

In this tranche, Coro sold 2 million units at C$1.50 per unit. It will sell an additional 8 million units in the second tranche, expected to settle in late September, along with the loan facility.

Each unit is comprised of one common share and a one half-share warrant. Each whole warrant will be exercisable at C$2.00 for three years.

The warrants may expire sooner under certain circumstances.

"We are delighted to have entered into this financing arrangement with the Dundee Global Resources LP and look forward to closing the transaction as soon as possible," Coro president and chief executive officer Alan Stephens said of the financing in a press release, "The acquisition of Cerro Negro will propel Coro into the ranks of copper producers at a time of high copper prices, and means that we will have achieved the first part of the business strategy we set out when Coro was founded in 2005.

"Cash flow will be employed to further enhance the Cerro Negro operations and to advance the company's development project pipeline. We very much welcome the partnership as a major shareholder in Coro, which we view as a vote of confidence in our business model and management team, as we continue to grow Coro into a successful mid-tier copper mining company."

The company's shares (Toronto: COP) were unchanged, closing at C$1.25 on Wednesday.

Wintrust wraps $50 million

Wintrust, a financial services company, celebrated a financial achievement after the close Tuesday when it announced the completion of a $50 million private placement of non-cumulative perpetual convertible preferred stock with funds controlled by CIVC Partners.

"The successful private sale of capital reflects the confidence experienced financial services investors place in Wintrust's balance sheet strength and growth potential," Wintrust president and chief executive officer Edward J. Wehmer said in a press release. "This transaction enhances Wintrust's capital position.

"We have chosen to raise capital given our belief that a stronger balance sheet is a valuable asset in today's uncertain economic environment. This capital will support our growth as a premier community banking franchise in the strategic Chicago and Milwaukee metropolitan areas and provide further financial stability in today's unpredictable markets."

Dividends on the preferreds are payable quarterly in arrears at a rate of 8% per annum.

The securities are convertible into common stock at $27.38 per share and may be subject to mandatory conversion, under certain circumstances.

The additional capital will be used to enhance further the company's capital ratios.

The Lake Forest, Ill.-based company's shares (Nasdaq: WTFC) moved upward 2.64%, or 57 cents, closing at $22.19 Wednesday.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.