Mining companies eye PIPE transactions; Optimer to raise $32.95 million; Jesup wraps two deals

By Stephanie Rotondo

Portland, Ore., March 5 - Mining companies entered the PIPE market again, marking a trend in Thursday's session.

But other sectors were also represented. Optimer Pharmaceuticals Inc., for example, announced a plan to raise $32.95 million through the sale of stock and units.

Jesup & Lamont Inc., which said it had completed two private placements on Wednesday, gave new details regarding those transactions on Thursday. The company's chairman also told Prospect News that the new financing gives the brokerage firm more opportunities to expand.

In the mining sector, Lihir Gold Ltd. said late Wednesday that it had wrapped a $325 million institutional placement of stock. The company said the funds would serve to strengthen its balance sheet.

EMED Mining Public Ltd. arranged an $8.5 million convertible secured loan facility, according to a press release. The company intends to use the funds toward its 2009 business plan.

Metanor Resources Inc. will raise C$12 million through a private placement of units, which consist of both stock and warrants.

Optimer to sell stock, units

Optimer Pharmaceuticals announced that it was planning to raise $32.95 million through a direct offering of stock and units.

The company will sell 457,666 units consisting of one common share and one warrant good for one-fifth a share at $10.00 per unit. Each whole warrant is exercisable at $10.925 for five years. The proceeds from the units sale totals $5 million.

The company raised the remaining $27.95 million by issuing about 2.8 million common shares at $10 per share.

A person familiar with the transaction who declined to be named told Prospect News that the company was very pleased with the deal and that market conditions were the factor in choosing a direct placement over other financings routes.

Settlement is expected on March 9.

Proceeds will be used to fund development of Optimer's products and for general corporate purposes.

Optimer's equity (Nasdaq: OPTR) declined 30 cents, or 2.74%, to $10.63. Market capitalization is $321 million.

Optimer Pharmaceuticals is a San Diego-based biopharmaceutical company.

New details in Jesup deal

Jesup & Lamont gave new details regarding its recent $4.2 million private placement in a regulatory filing.

The Longwood, Fla.-based investment firm said it sold $2 million of 9% convertible debentures and $2.2 million of units on Feb. 27, according to an 8-K filed with the Securities and Exchange Commission. The convertibles were sold to Legent Clearing LLC. The notes mature in five years and are convertible into stock at $0.50 per share.

The units were sold at prices ranging from $1.365 to $2.125. Each unit included four common shares and a warrant. The warrant is good for five years, with strike prices ranging from $0.341 to $0.55 per share.

Steven Rabinovici, chairman of Jesup & Lamont, said that the company was pleased with the outcome of the deal.

"In the world we live in today, we believe there is tremendous opportunity," he told Prospect News. "For firms of our size, this is a huge opportunity to continue and grow our business.

"Given the turmoil in the larger firms, the opportunity to grow is potentially once in a lifetime."

Rabinovici also noted that the company's position within the fixed-income market was a boon, given that not all firms were equipped to enter that market. Jesup had said that proceeds from the deal would be used to expand its brokerage operations at its Jesup & Lamont Security Corp. subsidiary.

Rabinovici added that the decision to enter the PIPE market was because it was the "fastest way to get [the financing] done" and that the company already knew some of the participating investors.

Jesup's stock (Amex: JLI) gained 2 cents, or 5.26%, to $0.40. Market capitalization is $8.31 million.

Lihir completes stock sale

Lihir Gold announced late Wednesday that it had completed a $325 million institutional placement of common stock.

The company sold 172 million shares at A$3.00 per share. No warrants were included in the deal.

"This is an excellent outcome for LGL shareholders," said Arthur Hood, Lihir's chief executive officer, in a press release. "The company is very well-positioned to accelerate the Million Ounce Plant Upgrade at Lihir Island and to take advantage of opportunities that arise to develop our operations in West Africa.

"We have a strong balance sheet, an exciting growth profile and a very competitive cost structure, and we look forward to delivering increasing returns for our shareholders."

Lihir's stock (Nasdaq: LIHR) dropped 79 cents, or 3.81%, to $19.92.

Lihir Gold is a Port Moresby, Papua New Guinea-based gold exploration company.

EMED gets credit facility

EMED Mining has negotiated an $8.5 million convertible loan facility with Resource capital Fund IV LP and RMB Australia Holdings Ltd., according to a press release.

Resource Capital will provide $6.5 million, and RMB will provide the remaining $2 million. The 7.5% interest-bearing facility matures on Dec. 30, 2011. Interest will be paid in either cash or new shares of common stock.

Furthermore, EMED will pay an establishment fee of $212,500, along with an annual commitment fee of 3% on undrawn amounts. The establishment fee will be paid through the issuance of about 3.8 million ordinary shares at 3.969p per share.

"The convertible loan facility with RCF and RMB, two long-standing shareholders of the company, is intended to provide the finance required for the 2009 business plan and budget of the company aimed principally at progressing the company's two wholly owned core assets [Detva Gold Project in Slovakia and Rio Tinto Mine in Spain]," said Harry Anagnostaras-Adams, the company's managing director, in a statement.

"This package of initiatives represents part of the company's response to the global financial crisis and reflects active support for the company from shareholders (RCF and RMB), financier (YA), the Rio Tinto Mine vendor, the sales and marketing agent (MRI), the board and management. It is pleasing that the company is so strongly supported and it is encouraging that the gold and copper sectors are amongst the best performing asset classes internationally so far in 2009."

EMED's stock (London: EMED) closed at 3.6p Thursday.

EMED is a mineral exploration company with headquarters in Cyprus.

Metanor prices deal

Metanor Resources, a Val d'Or, Quebec-based mining company, said it would sell C$12 million units in a private placement.

The company plans to issue 24 million units, with each unit including a common share and one-half share warrant, at C$0.50 per unit. Each whole warrant is exercisable at C$0.65 for two years.

Also, Northern Securities Inc, which acted as lead agent for the deal, has a greenshoe for C$3 million, or 6 million units.

Metanor will use the funds from the deal to start a work program to rehabilitate and improve surface infrastructure at its Bachelor Mine.

Metanor's equity (TSX: MTO) fell 8 cents, or 14.29%, to $0.48.

© 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.