Geokinetics stock jumps 12.5% on $25.15 million stock deal; eLEC wraps $2 million note offering

By Sheri Kasprzak

New York, Dec. 2 - Geokinetcs Inc. led PIPE news to round out the week, wrapping up a $25.15 million stock offering as oil prices continued to rise, boosting energy offerings in Canada but pushing back volume in the United States.

In the Geokinetics deal, the company sold to a group of institutions 20.12 million shares at $1.25 each.

The company had 18,992,113 common shares outstanding as of Sept. 30.

After the offering was announced Friday morning, the company's stock gained 25 cents, or 12.5%, to close at $2.25.

Thomas Concannon, the company's chief financial officer, was not immediately available for comment on the offering Friday.

Geokinetics completed a private placement on Dec. 6, 2004 for $2,499,900, selling 8,333 shares of its 6% convertible preferred stock at $300 each. The prefereds were convertible at $0.30 each.

Recently, Geokinetics reported net income of $416,281 for the quarter ended Sept. 30, which was down from net income in the year-ago period of $777,254.

The Houston-based company, which provides seismic data-processing services to the oil and natural gas sector, plans to use the proceeds to complete its acquisition of Trace Energy Services Ltd. That acquisition closed along with the PIPE.

Geokinetics bought all of the outstanding shares of the Calgary, Alta.-based company for C$35 million.

Elsewhere in the PIPE market, eLEC Communications Corp. settled a $2 million note deal with Laurus Master Fund, Ltd.

The three-year note bears interest at Prime rate plus 200 basis points and is convertible into common shares at $0.61 each.

After the deal was announced Friday afternoon, the company's stock gained 2 cents, or 4.65%, to settle at $0.45.

Proceeds from the deal will be used for the growth of the company's voice-over-internet protocol subsidiary VoX Communications.

White Plains, N.Y.-based eLEC is a telecommunications company focused on local, long distance, dedicated access and voice-over-internet protocol products.

Oil prices rise

Looking to the broader PIPE market, oil prices rose for the second straight session as colder temperatures and threats of snow crept into the news.

Oil prices gained $0.85 Friday to end at $59.32 per barrel.

"Any time oil moves up any substantial amount, it's bound to give pause [to issuers]," said one market source. "Stocks seem to be holding up OK but were down earlier."

As for the Dec. 5 week, this sellside source said energy deals will probably be prominent in the market given current oil prices.

In Canada, another sellside source said issuers there are still pricing lots of flow-through share deals before the year closes.

"Even if their stock is [not performing well], investors will buy up the flow-through shares because they get a really good break in taxes," he said.

Axmin prices C$20 million stock deal

Heading to Canada, Toronto-based mineral explorer Axmin, Inc. priced a previously announced C$20 million stock offering Friday.

The company intends to sell 38,461,550 shares at C$0.52 apiece.

RBC Capital Markets is the placement agent for 19,575,000 of the shares.

Axmin will sell the non-brokered portion of the deal to Addax Mining Holdings BV and company insiders.

"This is a significant step for Axmin as we move toward feasibility on our Passendro gold project in the Central African Republic," said Jonathan Forster, the company's chief executive officer, in a statement. "We look forward to using the funds to continue to expand and upgrade the mineral resources and complete the feasibility study on this exciting project as well as to progress our other exploration properties in the CAR and in West Africa."

Proceeds will be used for an ongoing pre-feasibility study on the Passendro gold project in the Central African Republic. The proceeds will also be used for ongoing exploration elsewhere.

The company's stock lost C$0.01 on Friday to close at C$0.58.

Another mineral exploration company also based in Toronto - Weda Bay Minerals Inc. - priced a C$17.6 million unit offering Friday.

The company plans to sell 17.6 million units of one share and one half-share warrant. The whole warrants are exercisable at C$1.50 each for two years.

Millennium Partners, LP has agreed to subscribe for half of the deal and institutional accounts managed by Capital Guardian Trust Co. will buy the other half.

Proceeds will be used for a feasibility study at the Halmahera nickel/cobalt project. The rest will be used for general corporate purposes.

The offering is slated to close Dec. 16.

The company's stock lost C$0.07, or 7.37%, to end at C$0.88 Friday.

Great Plains leads energy offerings

Moving to the energy sector, Calgary's Great Plains Exploration Inc. announced its plans to head to the PIPE market with a C$5,022,000 stock deal.

The offering includes 1.62 million flow-through shares at C$3.10 each.

The deal is being placed through a syndicate of underwriters led by GMP Securities LP and is expected to close Dec. 15.

Proceeds will be used for the company's 2006 capital expenditure program.

On Friday, Great Plains' stock fell C$0.04 to close at C$2.45.

Sharon Energy Ltd., also a Calgary-based oil exploration company, also priced an offering on Friday.

In its deal, the company plans to sell up to 10 million units at C$0.50 each.

The units include one share and one half-share warrant, the whole of which is exercisable at C$0.65 each for 18 months.

Research Capital Corp. is the placement agent.

Proceeds will be used for working capital and for exploration and development on projects in the United States.

The company's stock closed unchanged at C$0.55 Friday.

Battle Mountain stock jumps 11.3%

Battle Mountain Gold Exploration Corp.'s stock got a boost a day after pricing a $10 million private placement to fund its acquisition of Imagold Corp.

The company's stock gained 6 cents, or 11.32%, on Friday to close at $0.59.

On Thursday, after the company priced the PIPE, its stock edged up a penny to settle at $0.53.

The offering includes subscription receipts at $0.45 each. The receipts are exchangeable for units of one share and one half-share warrant once the acquisition is completed.

Based in Reno, Nev., Battle Mountain is a gold exploration company.

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