YRC Worldwide to sell convertibles; Harvest Natural eyes $32 million; OneEx wraps warrant sale

By Stephanie N. Rotondo

Portland, Ore., Feb. 11 - The PIPE market was relatively active Thursday with more double-digit deals.

YRC Worldwide Inc. announced it was planning to issue $70 million new convertible debt to cover its 2010 debt obligations. The deal is expected to come in two tranches, pending shareholder approval.

Harvest Natural Resources Inc. also brought a new convertible notes deal, a $32 million registered direct offering.

In completed financings, One Exploration Inc. said it had raised C$25 million from a private placement of special warrants. The funds will be used for the company's drilling program.

Also, ProMetic Life Sciences Inc. received equity financing of $13 million. The financing included a $3 million private placement of stock, as well as a new $10 million term loan. One investor participated in the deal.

Range River Gold Ltd. took in A$3 million from a private placement of shares. The company intends to raise another A$5.4 million via a public rights offering.

YRC to issue new convertible debt

YRC Worldwide is planning to issue new debt to cover its 2010 note obligations, the Overland, Park, Kan.-based company said in a press release.

The company intends to raise $70 million from a private placement of 6% unsecured convertible notes. The four-year notes are convertible into common stock at an initial conversion price of $0.43. The conversion price represents a premium to the volume-weighted average price of YRC's class A preferred shares over the last 10 trading days.

The new notes will join the company's other convertible paper, including the 5% notes due 2023 and the 3 3/8% notes due 2023.

The deal is expected to come in two tranches. The first, for proceeds of $49.8 million, will be used to "fully satisfy" any outstanding 8½% notes due April 15, which was the subject of a recent tender offer. The second tranche, which is contingent upon settling litigation regarding put rights for the 5% and 3 3/8% notes, will bring in the remaining $20.2 million.

The second portion will either be used for working capital purposes, should the litigation be solved in favor of the company, or for upcoming obligations on the existing notes.

"We are pleased to announce this important step to satisfy our remaining 2010 note obligations," stated Bill Zollars, chairman and chief executive officer, in the release. "Upon the closing of this funding, our management team will be able to focus on operational improvements without the financial overhang related to these debt maturities that have concerned our customers in recent months. Both the company and our customers will be able to put this distraction behind us with the completion of this financing."

YRC's stock (Nasdaq: YRCW) fell $0.0333, or 4.97%, to $0.6367. Market capitalization is $38.2 million.

Harvest seeks $32 million

Harvest Natural Resources priced a $32 million registered direct offering of convertible notes.

The Houston-based company will sell 8¼% senior convertible notes due March 1, 2013. Interest on the debt is payable semi-annually and are convertible into common stock. The conversion rate is 175.2234 shares per each $1,000 principal amount of notes held, or $5.71 each.

Proceeds will be used for capital expenditures, working capital and general corporate purposes. Settlement is expected by Feb. 17.

The company declined to comment on the deal until it is officially completed.

Harvest's shares (NYSE: HNR) gained 74 cents, or 16.86%, to $5.13. Market capitalization is $157.4 million.

OneEx wraps warrant sale

One Exploration sealed C$25 million from a private placement of special warrants, the company announced.

OneEx sold 100 million of the warrants in the deal. The warrants are convertible into class A common shares.

Proceeds will be used to fund the Calgary, Alta.-based exploration company's 2010 drilling program and for general corporate purposes.

Calls seeking comment were not returned Thursday.

OneEx's equity (TSX Venture: OE-A) improved by half a cent, or 1.69%, to C$0.30. Market capitalization is C$34.4 million.

ProMetic sells stock, gets loan

Among other settled financings, ProMetic Life Sciences, a Montreal-based biopharmaceutical company, said it raised $13 million via a private stock sale and a new loan agreement.

Los Angeles-based Abraxis BioScience is the investor.

According to the terms of the deal, ProMetic sold 17.85 million common shares to the investor at $0.18 per share. Total proceeds from the equity investment came to just over $3 million.

Additionally, Abraxis will give the company another $10 million in the form of a 5% five-year term loan. The loan is repayable in five annual installments.

"These funds, coupled with our revenue growth, place ProMetic on a strong financial footing," stated Pierre Laurin, ProMetic's president and CEO, in a news release announcing the transaction. "What is great about this loan is that its repayment structure allows management to focus on increasing the share price thereby minimizing the potential dilutive effect of any subsequent conversion of the debt on existing shareholders."

"The level of cash invested, when combined with product and service sales, provides a runway of cash for the foreseeable future," added Bruce Pritchard, chief financial officer. "However, management will continue to tightly control costs, focusing spending only on those areas of value creation, and of course will continue to aggressively pursue revenue growth opportunities."

ProMetic's shares (Toronto: PLI) increased by 1½ cents, or 8.33%, to C$0.195. Market capitalization is C$56.4 million

Range River deal done

Melbourne, Australia-based Range River Gold took in A$3 million from a private placement of common equity.

The company issued 107.1 million shares at A$0.028 per share.

Range River is also seeking up to A$5.4 million from a renounceable rights offering for existing investors. Investors can purchase one new share for every nine shares held.

Of the rights issue, A$2 million is underwritten.

"The total funds raised from the placement and rights issue will be used to augment working capital for the Mt. Morgans Mine and to advance exploration on a number of prospective extensions of existing deposits and near mine targets at Mt. Morgans," the company said in a statement. "The company's Mt. Morgans Mine is currently in ramp up to full production, for which the company requires additional working capital."

Range River's equity (Australia: RNG) closed at A$0.031.

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