G-III Apparel secures $15.16 million from stock offering; Canadian economy sets PIPE pricing back

By Sheri Kasprzak

New York, July 13 - Heading up PIPE activity in the United States Thursday even as stocks continued to slide was a $15,165,000 stock offering from G-III Apparel Group, Ltd.

Affiliates of Prentice Capital Management, LP agreed to buy 1.5 million shares at $10.11 each, a 3% premium to the company's $9.80 closing stock price on July 12. The investors received warrants for 375,000 shares, exercisable at $11.00 each for five years.

Separately, the investors purchased 500,000 shares of G-III at $9.25 each from Aron Goldfarb, the company's co-chairman.

Proceeds will be used to repay the balance of G-III's revolving credit agreement.

At the end of the day, G-III's stock climbed by 5.71%, or 56 cents, to end at $10.36 (Nasdaq: GIII).

"We are very pleased to have received the support of Prentice and believe that they share in our vision for the future of G-III," said Morris Goldfarb, the company's chief executive officer, in a statement.

"Never before in the history of our company have our prospects been so promising or so diverse. We intend to push forward with the expansion of our business, not only in our core outerwear programs but in sportswear, tailored clothing, dresses and other categories of apparel. We are creating opportunities for our business in every season and intend to demonstrate our ability to drive excellent returns for our shareholders as we transform our company."

G-III, based in New York, manufactures sportswear under licensed labels and under its own label.

Canadian economy impacts PIPEs

Looking to the Canadian private placement market, a slate of issuers announced their plans to conduct private placements, but those companies haven't set terms on their offerings yet.

The reason for this, one Canadian market source said Thursday, may be coming from economic data shoving down Canadian stocks.

"What isn't going on in Canada," he said when asked about potential factors keeping issuers from pricing these deals. "There's a lot of economic data out now that isn't too good and that seems to be weighing stocks down."

In particular, the Bank of Canada recently announced that the Canadian gross domestic product will climb 2.9% in 2007 and 2.8% in 2008, down from the original forecasts of 3% and 2.9%, respectively. The fear, the sellsider said, is that exports from Canada will drop.

Among the deals that were announced in Canada Thursday without pricing terms was a C$30 million stock deal from Farallon Resources Ltd. to conduct surface exploration on a mineral deposit in Mexico. The deal includes a C$7.5 million greenshoe and is set to close Aug. 23.

Farallon's stock fell 4 cents, or 5.63%, to close at C$0.67 (Toronto: FAN).

Vancouver, B.C.-based Farallon is a mineral exploration company.

Yukon Zinc Corp., another Vancouver, B.C.-based mineral explorer, said it plans to raise up to C$5 million in an offering of flow-through shares and units of one share and one half-share warrant. The company plans to sell C$3 million in shares and C$2 million in units.

The offering is being conducted through a syndicate of agents led by Paradigm Capital Inc. and Blackmont Capital Inc.

On Thursday, the stock fell 8.96%, or 3 cents, to end at C$0.305 (TSX Venture: YZC). The stock closed unchanged at C$0.335 (TSX Venture: YZC) Wednesday.

Search engine operator redCity Search Co. Inc. announced its plans to raise C$8 million in an offering, the price per share of which will not exceed C$0.0825.

GMP Securities LP, lead agent for the offering, has a greenshoe for up to 15% of the offering size.

Proceeds will be used to pay for the cash portion of redCity's acquisition of Zip411 Enterprises Inc. and the cash portion of the company's acquisition of Offsite Corp. The rest will be used to repay debt and provide working capital.

Offsite is a Toronto-based software development company, and Zip411 operates a search engine.

RedCity's stock jumped by 23.08%, or a penny and a half, to close at C$0.08 Thursday. On Wednesday, the stock closed unchanged at C$0.065.

Toronto-based redCity operates search engines that allow users to find local businesses.

Romarco leads gold offerings

Elsewhere in Canadian offerings, Romarco Minerals Inc. led a small group of gold offerings Thursday as gold prices pushed their way up over $660 per ounce.

The Romarco deal includes up to 31,578,947 units at C$0.19 each. The units are comprised of one share and one warrant. The warrants are exercisable at C$0.30 each for two years. The non-brokered deal is scheduled to close Aug. 22.

Proceeds will be used for exploration on the company's properties at the Pinos Gold District in Mexico. The rest will be used for working capital.

The company's stock lost a penny on Thursday to close at C$0.21 (TSX Venture: R).

Romarco is based in Vancouver, B.C.

Gold prices Thursday climbed by $6.60 to end the session at $661 per ounce.

In other gold offerings, ValGold Resources Ltd. priced a C$1,545,000 private placement of flow-through and non flow-through units.

The offering includes up to 3.5 million flow-through units at C$0.30 each and up to 1.8 million non flow-through units at C$0.275 each.

The flow-through units consist of one share and one warrant. The whole warrants are exercisable at C$0.40 each for the first year and at C$0.50 each for the second year.

The non flow-through units include one share and one warrant. Each warrant is exercisable at C$0.40 for the first year and C$0.50 for the second year.

Blackmont Capital Inc. is the placement agent.

Proceeds will be used for ongoing exploration on the company's Garrison Township gold project in Ontario. The rest of the proceeds will be used for working capital.

ValGold's stock fell 17.19%, or 5.5 cents, to close at C$0.265 (TSX Venture: VAL).

ValGold is also based in Vancouver, B.C.

Finally, Augyva Mining Resources Inc. concluded a private placement of flow-through shares for C$1.21 million.

The company sold 1.1 million shares at C$1.10 apiece on a non-brokered basis.

Proceeds will be used for exploration on the company's properties in Canada.

Augyva stock slipped by a penny to end at C$0.93 (TSX Venture: AUV).

Quebec-based Augyva is a gold and mineral exploration company.

Marshall Edwards stock slips

After concluding an $18,355,003 private placement of stock and obtaining a $15 million equity line on Wednesday, Australian pharmaceutical company Marshall Edwards, Inc.'s stock dipped by 2.85% on Thursday.

The stock lost 10 cents to close at $3.41 Thursday (Nasdaq: MSHL). On Wednesday, the stock gave up 7 cents, or 1.96%, to end at $3.51.

The company sold shares at $2.90 each to accredited investors, a 19% discount to the company's $3.58 closing stock price on Tuesday.

Cornell Capital Partners, LP also funded a $15 million equity line. Cornell may buy shares of Marshall Edwards at 97% of the lowest volume weighted average price for the five trading days after notice of a draw over the course of two years.

Located in North Ryde, New South Wales, Australia, Marshall Edwards is a pharmaceutical company focused on developing treatments for cancer. The company is developing a drug called Phenoxodiol to treat prostate cancer.

© 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.