Oil, resources dominate private placements; Canex Energy prices C$10.12 million deal

By Sheri Kasprzak

Atlanta, March 17 - Riding the wave of record-high oil prices, Canadian oil companies propelled private placement volume along with mineral and metal exploration issuers Thursday.

Stronger pricing and, thus, better stocks drove the natural resources and energy companies dominating issuance Thursday, according to sell-siders.

"You got it on the oil and gas prices," said one Canadian market source when asked about higher oil related to more energy companies in the market. "Gold is a little weaker now but has been stronger. Base metals are all much stronger."

"Of course those higher oil prices are driving issuance today," said another market source.

"Energy companies with a need for capital are going to try and get it when the pricing is best for them. That time is now. After yesterday's oil prices, there's really no surprise that so many oil companies were out there today."

Oil prices finally headed lower Thursday after reaching record highs Wednesday. By the end of the day, prices were down $0.06 to close at $56.40 per barrel. On Wednesday, oil climbed $1.41 to close at $56.46 per barrel.

Energy companies announcing deals Thursday included PetroGlobe Inc., Arapahoe Energy Corp. and Canex Energy Inc.

Minerals and metals companies that announced their intentions to raise money in private placements included Aldershot Resources Ltd., Crosshair Exploration and Mining Corp., Halo Resources Ltd., Pure Gold Corp. and Canadian Royalties Inc.

Heading up activity in the private placement market Thursday was Canex Energy Inc. Canex said it plans to raise C$10,125,000.

The company plans to sell up to 3.75 million shares at C$2.70 each.

An underwriting syndicate led by Tristone Capital Corp. has an over-allotment option for up to 750,000 additional shares, exercisable up to 48 hours before closing.

"I'll tell you, oil prices from yesterday helped," said one market source of the deal. "The pricing looks good to me. Very small discount. I'd say the sector in general benefited just from the surge yesterday."

Based in Calgary, Alta., Canex is an oil and natural gas exploration, development and production company. It plans to use the proceeds from the deal for continued exploration and development.

Canex's stock closed unchanged at C$2.90 Thursday.

Intermap raises C$9.02 million

Away from resources, Intermap Technologies Corp. said it raised C$9,025,447 in a private placement of units.

The company issued 2,005,655 units at C$4.50 each to two institutional investors.

The units include one share and one warrant. The warrants allow for an additional share at C$5.30 each for three years.

"We welcome the strong interest of U.S. investors in the Intermap opportunity," said Brian Bullock, Intermap's chief executive officer and president, in a statement. "These significant investors share our vision in NextMap and recognize the potential it presents. This incremental investment increases the working capital available to Intermap for the NextMap initiative while enabling major shareholders to increase their holdings."

Based in Denver, Intermap provides digital remapping technologies, including digital topographic maps. The proceeds will be used for working capital and to expand the build-out of NextMap USA, a program used to create a three-dimensional countrywide database of the United States.

On Thursday, Intermap's stock closed unchanged at C$5.25.

PetroGlobe's C$6 million offering

PetroGlobe Inc. announced its plans to raise C$6 million through the sale of flow-through and common stock.

The company plans to sell flow-through shares at C$0.70 each and common shares at C$0.60 each.

"Oil prices, oil prices, oil prices," joked one Canadian market source who had seen PetroGlobe's offering. "I think every energy company out there today is reaping the rewards of those higher oil prices."

The sell-sider said early Thursday afternoon that prices were continuing to rise. Prices retreated from all-time highs around $57 per barrel Thursday afternoon.

Based in Calgary, Alta., PetroGlobe is an oil and natural gas exploration and development company. It plans to use the proceeds from the flow-through shares to drill shallow gas wells in Alberta. The proceeds from the common shares will be used to appraise wells in Texas and acquire acreage in Texas. The remainder of the proceeds from the common shares will be used for general corporate purposes.

PetroGlobe's stock closed unchanged at C$0.70 Thursday.

Peer 1 plans C$1.4 million deal

Peer 1 Network Enterprises, Inc. said it would head to the private placement market with an offering for up to C$1.4 million.

The non-brokered deal includes up to 5 million shares at C$0.28 each.

"Only a slight discount, looks like it's pretty much in line," said one market source familiar with the deal. "I think this company has been performing well, but the tech sector itself has been struggling. I think that this company actually managed to price ... reasonably in line is a reflection of some corporate strength."

Based in Vancouver, B.C., Peer 1 provides Internet bandwidth. The proceeds will be used for general working capital.

Peer 1's stock closed down C$0.01 at C$0.30 Thursday.

Ag Growth's stock makes gains

Ag Growth Income Fund's stock made gains Thursday after announcing its plans to raise C$21.5 million in a private placement.

The company's stock closed up C$0.10 Thursday at C$13.90 after dropping C$0.10 to close at C$13.80 Wednesday when the deal was first announced.

The company plans to sell trust units at C$13.50 in an effort to acquire another company.

"I would say a combination of the offering and the announcement of the acquisition boosted them back up," said one sell-sider. "If you ask me, it's not really any movement at all, since they basically just gained what they lost yesterday."

Based in Rosenort, Man., Ag Growth manufactures portable grain handling equipment.

Business Bank's stock down

Business Bank of Nevada's stock suffered slight losses Thursday, a day after it announced the closing of a $4,201,400 private placement.

On Thursday, the company's stock closed down $0.10 at $39.90. After announcing the closing early Wednesday afternoon, Business Bank's stock closed up $1 at $40.

The company sold shares at $35 each.

Based in Las Vegas, Business Bank of Nevada is a community bank owned by Business Bank Corp.

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