Carrizo Oil gears up to wrap $35.1 million of stock; Energy Infrastructure raises $8.25 million

By Sheri Kasprzak

New York, July 28 - To round out the week of activity in the PIPE market, Carrizo Oil & Gas, Inc. announced the pending completion of a $35.1 million stock sale even as the broader market practically ground to a halt.

"You've got earnings to consider, you've got the fact that it's summer and things are just generally slower this time of year," said one sellside market source when asked about sinking PIPE volume Friday. "Stocks look great, so I predict pretty decent volume in August. I'm not saying it's going to take off substantially, but I think it's one more thing we have in our favor."

On Friday, the Dow Jones Industrial Average climbed by 119.27 to close at 11,219.70; the Nasdaq composite index climbed 39.67 to end at 2,094.14; and the Standard & Poor's 500 composite index ended up 15.35 to close at 1,278.55.

The market on Friday seemed to be dominated by energy offerings even as oil prices took a dip. Oil prices fell $1.30 to end the session at $73.20 per barrel.

At the head of those offerings was the $35.1 million deal from Carrizo.

The company plans to sell 1.35 million shares at $26.00 each, a 10% discount to the company's $28.93 closing stock price on Thursday, to a group of institutional investors.

The company had 24,404,063 outstanding common shares as of May 1.

The offering represents 5.4% of the company's fully diluted outstanding shares.

The company's stock dipped on Friday, losing 1.6%, or 46 cents, to close at $28.47 (Nasdaq: CRZO).

Proceeds will be used for the company's capital expenditure program in 2006, including drilling at the Barnett Shale and onshore Gulf Coast properties. The rest will be used for general corporate purposes.

"This new financing will significantly improve liquidity for the company and provide additional funding for our 2006 capital expenditures program, including continued aggressive development of our Barnett Shale play and our ongoing acreage acquisition program in the other shale plays," said Paul Boling, the company's chief financial officer, in a news release from Friday afternoon.

Looking to the company's earnings statement, the company reported a net income of $6.65 million for the quarter ended March 31, compared with a net income of $482,000 for the same quarter of 2005.

Houston-based Carrizo is an oil and natural gas exploration company.

Energy Infrastructure's $8.25 million deal

Elsewhere in energy-related offerings, Energy Infrastructure Acquisition Corp. settled an $8,253,980 private placement of units just ahead of its $202.5 million initial public offering.

The company issued 825,398 units at $10.00 each in the private placement.

Each unit includes one share and one warrant, and the warrants are exercisable at $8.00 each through July 17, 2010.

Maxim Group LLC was the placement agent for the private placement and was the underwriter for the IPO.

In the IPO, Energy sold 20.25 million units, also at $10.00 each. The terms of the units in the IPO are the same as the units sold in the private placement.

On Friday, the company's stock gained a penny, or 0.1%, to end at $9.73 (Amex: EII).

New York-based Energy Infrastructure intends to acquire or combine with companies in the energy or energy asset business.

Reese raises $1.5 million

In the gold sector, Reese Corp. wrapped a $1.5 million non-brokered private placement of 750,000 units on Friday.

The units, which include one share and one warrant, were priced at $2.00 each.

Each of the warrants is exercisable at $3.50 through Jan. 31, 2007.

Proceeds will be used for drilling on the company's El Tiliche project in Mexico.

"We are very pleased to close a financing at a premium to the current market price of our stock," said Chris Crupi, Reese's CFO, in a statement. "We received tremendous interest from the investment community regarding this offering of treasury shares. An investment firm in Hong Kong, Hexagon Capital, agreed to invest these funds at a premium given our agreement to grant them the right to participate in future financings, which they place a significant value on."

On Friday, the company's stock gained 3.45%, or 5 cents, to close at $1.50 (OTCBB: RESE).

Reese, based in Ottawa, is a gold and precious metals exploration company.

Diomed stock falls again

In the biotech sector, Diomed Holdings, Inc.'s stock tumbled for the second straight session after the company wrapped a $10 million private placement of convertible preferreds.

The stock fell 10.61%, or 14 cents, to close at $1.18 (Amex: DIO). The stock gave up 6.38%, or 9 cents, to close at $1.32 on Thursday when the deal settled.

In the placement, Diomed issued preferreds that are convertible into common shares at $1.15 each.

Connected to the placement, holders of Diomed's existing convertible stock will tender about 4 million existing preferreds for shares of the new preferred stock.

In addition to the placement, the company's second-quarter earnings statement was also released on Thursday.

The company reported consolidated revenue of $6.1 million, up 33% from the first quarter of 2006 and up 27% over the second quarter of 2005.

Andover, Mass.-based Diomed develops minimally invasive medical devices used to treat varicose veins.

EDAP stock edges up

Elsewhere in biotechs, EDAP TMS SA's stock rebounded slightly after watching its stock drop by more than 20% on Thursday.

The company's stock gained 4 cents to close at $8.29 Friday (Nasdaq: EDAP). The stock had fallen 20.7%, or $2.16, to end at $8.25 on Thursday when it announced a $7,452,989 private placement.

The offering, which is scheduled to close Aug. 3, includes 961,676 American Depositary Shares at $7.75 each.

Based in Lyon, France, EDAP is focused on minimally invasive products to detect diseases like cancer.

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