Private placement volume gets boost from stocks, oil; First Union REIT plans $91 million deal

By Sheri Kasprzak

Atlanta, Feb. 25 - As stocks and oil prices climbed to end out the week, private placement volume surged right along with them.

"There are really several forces driving volume today," said one sell-sider. "Oil's better, stocks are better, gold has been strong. These things kind of all came together today and that's why we're seeing better volume."

The Dow Jones Industrial Average closed up 92.81 at 10,841.60; the Nasdaq composite index gained 13.70 to end at 2,065.40 and the S&P 500 ended the day 11.17 higher at 1,211.37.

Oil edged up $0.22 to close out the week at $51.49 per barrel.

Heading up private placement action, First Union Real Estate Equity and Mortgage Investments announced it plans to raise $90,998,000 in a private placement.

The offering includes 3.46 million shares of B-1 cumulative convertible redeemable preferred shares at $26.30 each sold to a small group of institutional investors.

The preferreds are convertible into common shares at $4.50 each and pay initial dividends of 6.5% annually.

Boston-based First Union Real Estate Equity and Mortgage Investments is a real estate investment trust.

The company's stock ended the day up $0.11 at $4.34.

Plains raises $22 million

Plains All American Pipeline LP said it has closed a private placement of partnership units for $21,924,750.

The company sold 575,000 units at $38.13 each, a 2.8% discount to the closing price on Feb. 24.

According to a statement from the company, the 2.8% discount compared "favorably" to the 4.25% underwriting discount normally associated with public follow-on offerings of units.

Based in Houston, Plains All American is in the business of oil transporting, gathering, marketing and storing. It plans to use the proceeds first to repay debt under a revolving credit facility and later fund a portion of its 2005 expansion capital program.

On Friday, Plains's stock closed up $0.29 at $39.51.

Gulfport wraps $14 million deal

Gulfport Energy Corp. said it has closed a private placement of shares for $14 million.

The company sold 4 million shares at $3.50 each to five institutional investors in two separate tranches.

"Gulfport plans to capitalize on rising commodity prices by aggressive drilling programs in both its West Cote Blanche Bay and East Hackberry fields to both exploit the company's proved undeveloped prospect inventory and find and develop new previously unidentified reserves," said Gulfport's chief executive officer Mike Liddell in a statement. "Gulfport is in the fortunate position of being prospect-rich in a prospect-poor market. We will also continue our production-enhancement operations in our WCBB field. This should allow us to increase our production profiles for 2005."

The company said it plans to use the proceeds from the private placement, as well as proceeds from the exercise of earlier-issued warrants and the redemption of preferreds, to execute its 2005 drilling program and research acquisition opportunities.

Based in Oklahoma City, Gulfport is an oil and gas exploration and production company.

Gulfport's stock closed up $0.15 at $4.15 on Friday.

RNC releases details on offering

RNC Gold Inc. released details Friday on an upsized private placement for C$6 million.

The deal is comprised of 5 million units at C$1.20 each. The units consist of one share and one half-share warrant.

The whole warrants provide for an additional share at C$1.50 each for five years.

Canaccord Capital Corp. is the placement agent.

"Gold is really a hot commodity right now," said one Canadian sell-sider. "It's really no surprise they increased the size of the deal. The sector is strong and I think they realized that and decided to take advantage of the market to the fullest potential."

Even so, after the details of the deal were announced, RNC's stock dropped C$0.03 to end at C$1.32 Friday.

The deal was first announced Feb. 24 without details as a C$5.5 million offering.

Based in Toronto, RNC is a gold mining company. It plans to use the proceeds from the deal to develop its Cerro Quema gold project and explore the Bonanza and LaLibertad gold mine properties. The remainder will be used for working capital and general corporate purposes.

Neurologix closes $1.03 million offering

Neurologix, Inc. said it has raised $1.03 million in a private placement.

The company issued 792,000 shares at $1.30 each to institutional and individual investors.

Warrants for 198,000 shares at $1.625 each for five years were also included in the deal.

"The terms of this placement were the same as those in the [$1.44 million] transaction announced Feb. 11, 2005," said Michael Sorell, Neurologix's chief executive officer, in a statement. "Together with that transaction, the total financing round is approximately $2.5 million. The share price for the round represented a small premium to the market price at the time Neurologix and Merlin Biomed Group, which led the round, commenced discussion regarding the transaction in early December 2004."

Based in Fort Lee, N.J., Neurologix researches and develops treatments for disorders of the brain and central nervous system. The proceeds will be used for research and development, as well as general corporate purposes.

On Friday, Neurologix's stock closed unchanged at $2.20.

Tusk's stock remains up

A day after announcing its C$31.5 million private placement, Tusk Energy Corp.'s stock continued to make gains.

On Friday, the company ended up C$0.35 at C$5.30.

On Thursday, after the deal was first introduced, the company's stock gained C$0.30 to close at C$4.95.

The offering shares sold at C$4.50 each.

Tusk is a Calgary, Alta.-based oil and natural gas exploration, development and production company.

Bankers ends the week down

After announcing a C$35.65 million private placement earlier this week, Bankers Petroleum Ltd.'s stock ended slightly down Friday.

The company lost $0.07 to close at C$1.43 on Friday after ending up C$0.28 Thursday and up C$0.11 on Wednesday when the offering was first announced.

The company plans to sell shares at C$1.15 each.

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

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