Etruscan to raise C$10.5 million; Second Wave wraps stock sale; WesternOne gets C$2.1 million

By Stephanie N. Rotondo

Portland, Ore., Feb. 19 - Etruscan Resources Inc. announced a private placement agreement with investor 2190776 Ontario Inc. on Thursday that will give the company an additional C$10.5 million.

The deal includes both common stock and warrants for additional shares. A company spokesperson told Prospect News on Thursday that the deal would show investors that the company could weather the current economic storm.

Meanwhile, Second Wave Petroleum Inc. said in a statement that it completed its C$3.97 million non-brokered private placement of stock. The company did not say what the funds from the deal would be used for.

WesternOne Equity Income Fund also wrapped a private stock sale valued at more than C$2 million. The company said the transaction was a response to positive investor response following a private convertibles sale in December 2008.

Mining company PC Gold Inc. is planning to issue up to 3 million units to investors. The company expects to use the proceeds from the sale, valued at C$1.5 million, to further explore its mining property.

Etruscan to raise C$10.5 million

Etruscan Resources entered into a private placement agreement with investor 2190776 Ontario Inc. for about 26.3 million common shares and approximately 6.9 million warrants, totaling C$10.5 million.

The warrants can be converted to common stock at C$0.5478 per share until July 15, 2010, according to a press release. Richard Gordon, director of investor relations for Etruscan, told Prospect News that the stock price for the offering is 42 cents.

The two-tranche offering will close on Feb. 27 and March 23, respectively, with about C$5.8 million coming in the first part and the remainder coming at the second close.

Etruscan's stock (TSX: EET) closed at 50 cents, down 5 cents, or 9.09%. Gordon noted that traditionally, stock prices tend to fall to offering prices. However, since the equity did not fall to that level, he believed that the news had "been received well." Also, he felt it was "too early [for the stock] for a trend to form."

"There are two things that this deal shows," Gordon said. "This shows that we can raise money" and that the company now has a strategic shareholder joining its ranks, in the form of Ontario's owner, Maxim Finskiy.

Gordon added that Etruscan had budgeted C$10 million for the year to be used by the corporate entity. But the company only had "roughly C$3 million" stocked away, which had put pressure on the company's stock.

"There is an indication in the industry at the moment that banks are pulling back," he explained. "So there is not much debt or capital available though traditional [routes]."

Etruscan did try to enter the debt market, Gordon said, but the market conditions "forced us to raise equity."

Furthermore, Gordon believes that the raising of the funds and the potential of having a funding partner in Finskiy will prove not only to investors, but to the industry as well, that the company is well poised to handle the current downturn in the commodity arena and continue to grow the business.

"People in the know who recognize the name will quickly put two and two together," he remarked.

Etruscan will be working with Finskiy over the next 60 days to discuss Etruscan's next "moves forward," Gordon added.

Etruscan is a Halifax, N.S.-based junior gold mining company.

Second Wave wraps stock sale

Second Wave Petroleum wrapped a C$3.97 million non-brokered private placement of stock, according to a press release.

The Calgary, Alta.-based junior oil and gas company sold just over 6 million of its flow-through common shares at C$0.66 per share. A majority of those shares, deemed the Canadian Development Expense (CDE) shares, were purchased by Brookfield Bridge Lending Fund Inc. The remainder of the shares - called the Canadian Exploration Expense (CEE) shares - was sold to company management for C$0.70 per share.

Second Wave's stock (TSX: SCS) ended the day at 55 cents, a decline of 5 cents, or 8.33%.

Colin B. Witwer, Second Wave's president and chief executive officer, told Prospect News that the company had looked into doing a public offering to raise the funds, but it was felt that the terms of a private deal were better than a public offering.

"Investors or market response is neutral to positive," he said. "Bringing more capital is always a positive. This deal allows us to extend capital on less risky development plays."

Witwer added that the CEE shares are 100% tax deductible in the first year, while the CDE shares are 30% deductible each year.

WesternOne completes stock sale

Vancouver, B.C.-based WesternOne Equity completed a $2.1 million private placement of stock, the company announced Thursday.

The company sold 558,659 shares at $3.80 per share to accredited investors. Dundee Securities Corp. acted as placement agent.

On the news, the company's stock (TSX: WEQ.UN) closed at $3.75, a gain of 5 cents, or 1.35%.

Andrew Greig, manager of investor relations for WesternOne, said that the company was "very happy" with the terms of the deal in an interview with Prospect News.

Greig said that WesternOne chose the private market due to "interest from a handful of advisers that wanted to do something."

"Because a pretty good number of advisers missed the overnight offering [completed in December 2008], we did the private placement really as a thanks to those that missed the offering in December," he said.

Unlike the offering in December, which allowed the company to pay down about $8.4 million in debt, funds from the transaction will be used as growth capital, Greig added.

WesternOne Equity acquires equipment- and infrastructure-related businesses located in western Canada.

PC Gold to issue 3 million units

PC Gold will sell up to 3 million units in a private placement totaling up to C$1.5 million, the company said in a press release.

Each unit will consist of a common share at C$0.50 per share and one-half of a warrant. Each whole warrant can be converted to a common share at C$0.70 per share for a year from the closing date.

PC Gold has also allowed its agent, Canaccord Capital Corp., the option to solicit an additional 1 million units, equal to C$500,000.

The stock (TSX: PKL) finished the session at 61 cents, a 6-cent decline, or 8.96%.

Kevin M. Keough, PC Gold's president and chief executive officer, told Prospect News that the placement is "similar to our [initial public offering]" in that institutions and "well-off individuals are involved."

"We already know where to place the money, we really don't have to go looking for it," Keough gave as reason for choosing the private market.

Keough also noted that the company was pleased with the pricing of the deal given that "as recently as November [2008] we were trading at 11 cents."

Funds from the transaction will be used to further explore the company's Pickle Crow Gold Mine property.

PC Gold is an Ottawa-based mining company focused on gold.

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