HealthRenu gets $10 million equity line; volume remains sluggish despite higher stocks

By Sheri Kasprzak

Atlanta, May 26 - HealthRenu Medical Inc. led private placement news Thursday even as PIPE volume continued to stall.

HealthRenu's $10 million standby equity distribution agreement with Cornell Capital Partners, LP has a term of two years, but the details of the agreement couldn't be determined Thursday.

"We are pleased to enter into this agreement with Cornell Capital," said the company's president and chief executive officer Robert Prokos, in a statement.

"The flexibility and control afforded by this capital structure will enable us to access capital on favorable terms to HealthRenu Medical."

After the deal was announced Thursday morning, HealthRenu's stock gained $0.06, or 21.43%, to close at $0.34.

Based in Houston, HealthRenu is a healthcare company focused on skin and wound-care products.

In the broader market, sell-siders said the lull in volume continued as the week wound down, even though stocks made meager gains Thursday.

"Yeah, stocks made gains, but I think it's a matter of how great the gains were compared to how many days we've seen significant drops [in stocks]," said one sell-sider. "One good day isn't going to convince issuers to come out in droves."

The Dow Jones Industrial Average gained 79.80 to close at 10,537.60; the Nasdaq composite index closed up 21.12 at 2,071.24 and the S&P 500 ended the day up 7.61 at 1,197.62.

Oil prices may make things look brighter for Canadian issuance, according to one sell-sider north of the border.

"Two days of gains, so that could be good for issuer confidence," said the Canadian sell-sider. "It won't happen overnight, but oil companies will gradually get back in."

Oil gained $0.03 to close at $51.01 per barrel on Thursday.

Even though oil companies may get into the market again, at least two companies announced the cancellation of their offerings.

Fuel Cell Technologies Corp. nixed a C$8 million deal for now and silver mining and exploration company First Majestic Resource Corp. decided not to proceed with a C$10.75 million offering. Both companies cited unfavorable market conditions as the reasons behind their decision to drop their private placements.

Corgenix's $3.63 million deal

Back in the United States, Corgenix Medical Corp. released the details of its previously announced $3,635,000 private placement of senior convertible term notes and stock.

Three institutional investors bought $3.42 million in senior convertible term notes and $215,000 in common stock.

The notes mature May 19, 2008, bear interest at the greater of Prime plus 300 basis points or 12% annually and are convertible into common shares at $0.30 each.

The investors also received warrants for 7.7 million common shares at $0.25 each for seven years.

The company also sold 860,000 shares at $0.25 each for $215,000.

Ascendiant Securities LLC and Burnham Securities Inc. were placement agents.

Corgenix, a Denver-based maker of specialized diagnostic kits for immunology disorders, vascular diseases and bone and joint disorders, will use proceeds to refinance $970,000 of debt and for key strategic initiatives, working capital and other general corporate purposes.

The company's stock gained $0.04, or 14.81%, to close at $0.31 Thursday.

Huntingdon REIT plans C$20 million deal

Huntingdon Real Estate Investment Trust led Canadian private placements Thursday with its C$20 million offering of trust units and convertible debentures.

The offering includes up to C$15 million in trust units. The pricing of the trust units could not be determined Thursday.

The company also plans to sell up to C$5 million in convertible debentures.

The five-year debentures bear interest at 8% annually and are convertible after the second anniversary into trust units at C$3.30 each before the third anniversary of the closing; $3.65 each for the fourth year; and C$4.05 each for the fifth year.

Westwind Partners Inc. and Desjardins Securities Inc. lead a syndicate of placement agents.

Based in Winnipeg, Man., Huntingdon is a real estate investment trust. The proceeds will be used to purchase industrial and commercial real estate properties. The remainder will be used for general corporate purposes.

Huntingdon's stock closed down C$0.10 at C$2.90 Thursday.

GoldQuest arranges C$2 million deal

In Canada, GoldQuest Mining Corp. announced its plans to raise C$2 million in a private placement, riding on a surge of gold prices earlier in the week.

"Gold was definitely weaker today, but this deal really came out of the upward trend earlier," said one market source familiar with natural resources. "I think it [looks] okay."

GoldQuest plans to sell up to 8 million units at C$0.25 each.

The units include one share and one half-share warrant. The whole warrants allow for an additional share at C$0.30 each for two years.

The market source noted that the warrants are priced at a 16% premium to the company's closing stock price of C$0.25 on May 25.

"That could be good for them," said the market source. "It will probably go okay for them in the end."

Even so, GoldQuest's stock dropped C$0.05, or 20%, to close at C$0.20 on Thursday.

First Associates Investments Inc. is the placement agent.

Based in Toronto, GoldQuest is a gold drilling and exploration company. The proceeds from the offering will be used to expand the company's exploration and drilling program in the Dominican Republic. The remainder will be used for working capital.

C1 Energy's stock dips

A day after pricing an upsized C$12.5 million private placement - originally announced Wednesday as a C$10 million deal - C1 Energy Ltd.'s stock slipped.

The company's stock closed down C$0.05, or 1.96%, to close at C$2.50 Thursday.

After the offering was announced Wednesday, the company's stock closed unchanged at C$2.55.

C1 plans to sell common shares at C$2.35 each and flow-through shares at C$3 each.

Based in Calgary, Alta., C1 is an oil and natural gas exploration company.

East West's stock closes down

A day after downsizing two previously announced private placements, East West Resources Corp.'s stock edged down Thursday.

The company's stock lost C$0.005, or 4%, to close at C$0.12 Thursday after it re-priced a brokered and non-brokered private placement late Wednesday.

On Wednesday, the company's stock closed unchanged at C$0.125.

East West downsized two private placements, which had totaled C$3 million, to C$2 million.

The company will now sell units at C$0.12 each in separate brokered and non-brokered offerings of C$1 million each.

The units include one share and one warrant and the warrants provide for an additional share at C$0.15 each for two years.

Based in Vancouver, B.C., East West is a gold and base metals exploration and development company.

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