IntelGenx Technologies wraps $1.5 million PIPE; Fremont stock closes up 26.7%

By Sheri Kasprzak

New York, May 23 - As PIPE volume slowed to a crawl on Wednesday, IntelGenx Technologies Corp. led activity with a $1.5 million private placement of 8% secured convertible debentures.

Meanwhile, in the broader market, one sellsider said he did not feel that a slight drop in the stock market had anything to do with the drop in new-issue volume.

"There are some things getting done, at least we're doing a few things," he said. "Stocks are performing very well, at least on the grand scale, so I don't think that's even remotely causing any sort of delay in volume. I honestly don't think that one day of lag is that big of a deal."

Stocks did take a slight hit on Wednesday after early gains. The Dow Jones Industrial Average dropped by 14.30 to close at 13,525.65 and the Nasdaq composite index gave up 10.97 to end at 2,577.05. The Standard & Poor's 500 composite index fell by 1.84 to settle at 1,522.28.

In the IntelGenx offering, the company sold $1.5 million in 8% debentures due Sept. 22, 2009.

The debentures are convertible into common shares at $0.70 each.

The investors also received warrants for 2,142,857 shares, exercisable at $1.02 each for five years.

Carter Securities LLC was the placement agent for the offering.

On Wednesday, the company's stock fell by 5 cents, or 6.25%, to close at $0.75 (OTCBB: IGXT).

Located in Saint Laurent, Quebec, IntelGenx develops oral controlled-release products, including smoking cessation products.

Fremont stock skyrockets

Shares of Fremont General Corp. got a serious boost on Wednesday on news that the worst may be over for subprime mortgage lenders. The company announced an $80 million offering of exchangeable preferred stock on Tuesday as part of a restructuring that also includes the sale of its real estate lending business.

The stock jumped by 26.7%, or $2.67, on Wednesday to close at $12.67 (NYSE: FMT). On Tuesday, when the placement was announced, the stock gained $2.89, or 40.65%, to end at $10.00.

The stock gains come on the heels of news from Countrywide Financial that not only have interest-rate spread tightened, but liquidity has returned to the secondary market for subprime loans, suggesting that the worst may be over for the subprime lending market.

In the placement, the company plans to sell preferreds to an investor group led by Gerald J. Ford.

The preferreds are exchangeable for common shares at $8.44 each.

Once the preferreds are exchanged, the investor group will own 20% of the company's then-outstanding common stock.

The offering is being conducted as part of the sale of the company's commercial real estate lending business, the sale of a minority interest in the company and the appointment of new senior management.

Following the private placement of the preferreds, Ford will become the company's chairman and will name two executives to senior positions within the company.

iStar Financial Inc. will purchase the company's real estate lending business and outstanding loan portfolio. For this, Fremont General will receive cash of about 30% of the net loan portfolio, or $1.9 billion, and a participation interest equal to about 70% of the net loan portfolio, which will bear interest at Libor plus 150 basis points.

Fremont, based in Santa Monica, Calif., is a commercial and residential real estate lending company.

Pluristem stock closes up

In secondary market news in the biotech sector, Pluristem Life Systems, Inc.'s stock edged up on Wednesday, a day after the company announced the closing of a private placement for $14.875 million.

The stock gained 1.93% to close at $0.132 (OTCBB: PLRS). On Tuesday, the company's stock gained 7.02% to end at $0.1295 after the offering was closed.

In the placement, the company sold shares at $0.0125 each to a group of investors that included Technion-Israel Institute of Technology.

The company closed the offering in two tranches - the first for 640 million shares settled in February and the second for 550 million shares, which settled on Monday.

New York-based Pluristem develops stem cell therapies to treat malignant, degenerative and autoimmune disorders.

Rambler raises C$14.03 million

In other activity, Rambler Metals and Mining plc led activity with the closing of a C$14.025 million offering of units.

The company sold 9.35 million units at C$1.50 each, including a greenshoe for 2.65 million units exercised by placement agent Haywood Securities Inc.

The units include one share and one half-share warrant with each whole warrant exercisable at C$2.00 through May 23, 2009.

Of the offering, 5.21 million units were sold through Haywood and the remaining 4.14 million units were sold on a non-brokered basis.

Proceeds will be used for drilling on the company's Rambler property in Newfoundland and on Labrador's Baie Verte Peninsula.

On Wednesday, the company's stock gained 4 cents to end at C$1.60 (TSX Venture: RAB).

Based in London, Rambler Metals is a mineral exploration company.

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