Opti Canada arranges C$185 million offering; gold companies get back in PIPE market

By Sheri Kasprzak

Atlanta, June 6 - Canadian oil sands developer Opti Canada Inc. led private placement news with its C$185 million offering in a day marked by increased volume.

The Opti Canada deal includes 6,271,186.44 units at C$29.50 each.

The units are comprised of one series C convertible preferred share and one half-share warrant. The whole warrants allow for one common share at C$29.50 each through Nov. 30, 2008.

The preferreds pay dividends at 5% annually and are convertible into common shares on a one-for-one basis.

The offering includes the C$36 million in units it sold May 5 to one of its directors and Gardiner Group Capital Ltd.

The offering is being completed through a syndicate of placement agents co-led by Tristone Capital Inc. and TD Securities Inc.

After the deal was announced Monday afternoon, Opti Canada's stock gained C$0.52 to close at C$26.87.

Opti Canada is based in Calgary, Alta. The proceeds will be used for the expansion of drilling activities.

In the broader private placement market, sell-siders said gold companies are getting back into the action as gold prices rise after falling early last week.

Among the gold companies announcing deals Monday was San Gold Resources Corp. with a C$2.03 million offering. Apollo Gold Corp. closed a C$4 million offering Monday.

"Gold has been making a slow comeback," said one sell-sider familiar with natural resources' stocks. "They're getting back out there gradually. We should see more of them this week than we have over the past two weeks, I'd say."

But gold wasn't the only natural resource out in the PIPE market Monday. Oil companies were making a comeback as well, as were mineral exploration companies.

"Minerals beyond gold are doing well too, so we're seeing some of those companies back in," said the sell-sider.

Some energy companies were in the PIPE market as well Monday, including Eldorado Resources Inc., which plans to raise up to $25 million and Keeper Resources, Inc., which plans to raise C$5.4 million.

Even though oil prices slid Monday, sell-siders said they feel energy companies have an interest in conducted PIPE deals because of higher oil prices last week.

Oil slid $0.83 to close at $54.20 per barrel on Monday.

PNM raises $100 million

An Albuquerque-based holding company for gas and oil concerns, PNM Resources, led private placement news in the United States with word that it has received the green light for a $100 million investment.

Cascade Investment LLC announced its plans to buy $100 million in equity-linked securities within the next month, though the details of the deal couldn't be determined Monday.

PNM plans to use the proceeds from the offering to retire the company's high-interest debt.

The investment from Cascade is connected to PNM's acquisition of Fort Worth-based TNP Enterprises. That acquisition was wrapped on Monday.

After the deal was announced Monday morning, PNM's stock gained $0.26 to close at $29.54.

Monarch Bank wraps $6.52 million deal

Moving away from oil, Monarch Bank has completed a $6,525,000 private placement of stock sold directly to 130 investors in the Hampton Roads area of Virginia.

The company sold 450,000 shares at $14.50 each.

"We are excited about the great interest in our stock and the future of Monarch Bank," said the company's president and chief executive officer William Rountree, in a statement. "We not only sold the majority of the shares locally, but we also saved over $300,000 by directly selling the shares to our customers, friends and families. Now we're ready to invest this new capital to support our many exciting growth and profit initiatives. One of our first moves will be to open a new office in September in Virginia Beach's Town Center market."

Based in Chesapeake, Va., Monarch is a community bank.

At market close Monday, Monarch's stock had gained $0.21 to close at $14.50.

World Golf League's $3 million offering

The financially troubled World Golf League announced its plans Monday to raise up to $3 million in a preferred stock offering.

One market source who is familiar with the company, said any investment the company can get will be a good one.

"They are having some serious problems, even to the point of not being able to continue operations, so whatever they can get is a good thing for them, at least for now," said the market source, who could not provide further details on the offering. "I wouldn't expect much in the way of pricing, but that's just from what I know of them."

The full details of the offering could not be determined by press time Monday, but the funding, according to a statement, will be available by Aug. 1.

After the deal was announced Monday afternoon, the company's stock slid $0.0002, or 8.33%, to close at $0.0022.

The company plans to use the proceeds from the offering to produce its Million Dollar Shootout reality television series.

"This is the final component to making the MDSO reality and allowing the WGL Inc. to retain all ownership rights to the series," said Mike Pagnano, the company's chief executive officer, in a statement. "We now have the capacity to commence with the full production of the MDSO, which will be scheduled for October 2005 in Las Vegas."

Based in Orlando, The World Golf League is a professional golf tournament organization.

PPOL's stock climbs

After announcing the closing of a $10,196,516 private placement Friday, PPOL, Inc.'s stock made gains Monday.

The company's stock climbed $0.03 to close at $3.88.

After the closing was announced Friday afternoon, PPOL's stock slipped $0.05 to close at $3.85.

PPOL sold shares at $4 each as part of its acquisition of K.K. U Service.

U Service develops, imports and exports telephone, fax, copier, computer and peripheral equipment.

Terax's stock rises

Moving back to oil, Terax Energy Inc.'s stock made some gains on Monday after announcing its plans to raise up to $10 million in a private placement late last week.

The company's stock gained $0.10, or 2.22%, to close at $4.60 Monday.

After the deal was first announced Thursday morning, the company's stock gained 100% to close at $4.65. The company's stock had been at $0.00 since a stock split in December 2004.

On Friday, the company's stock slid $0.15, or 3.23%, to close at $4.50.

Terax plans to sell units at $10 each.

Based in Dallas, Terax in an oil and natural gas exploration company.

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