Rentech settles $35 million PIPE; natural resources offerings jump on higher gold prices

By Sheri Kasprzak

New York, Nov. 16 - Rentech Development Corp.'s $35 million convertible debenture offering led private placement news Wednesday, while in Canada, higher gold prices and a jump in oil prices boosted natural resource offerings.

In the Rentech deal, M.A.G. Capital, Inc. and Pentagon Bernini Fund, Ltd. bought the 14% secured convertible debentures. The debentures mature in three years and are convertible into common shares at $3.50 each.

The two institutions also received warrants for 3.5 million shares, exercisable at $3.50 each for 10 years.

Proceeds will be used for costs related to Rentech's acquisition of Royster-Clark Nitrogen, Inc. The funding will be used to partially finance the $50 million purchase of all the outstanding shares of Royster-Clark Nitrogen.

Dennis Yacobson, the company's chief executive officer, had not returned calls for comment by press time Wednesday.

Looking to its earnings, Rentech posted a net loss of $2,462,743 for the quarter ended June 30, compared with a net loss of $1,184,087 for the same quarter of 2004.

Denver-based Rentech develops synthetic gasoline produced from gas-to-liquids and coal-to-liquids technologies.

The company's stock gained 2 cents to end the day at $2.85 after the settlement was announced Wednesday morning.

In the broader PIPE market Wednesday, sellsiders said a rise in oil prices and in gold prices may spark a surge in natural resources offerings in both the United States and Canada.

"There could be a few more deals, especially for [issuers] with properties in places like Nevada," said one market source. "[Resources] stocks shot up today."

In Canada, a market source there said the impact of the rising gold prices has already been seen, with quite a few gold offerings priced Wednesday.

"We're seeing a lot of them today," he noted. "I imagine the push is enough to bring in more through the end of the week."

Rising oil prices helped push volume among natural resources companies in both the United States and Canada Wednesday. The price of a barrel of oil rose 90 cents to finish at $57.88 per barrel after sustaining a substantial drop late last week.

Among the gold companies with offerings priced Wednesday were a C$43.5 million deal from Miramar Mining Corp., a C$3,081,250 flow-through share deal from Seabridge Gold Inc. and a C$2.5 million unit offering from Northland Resources Inc.

Advanced BioPhotonics' $4 million deal

Moving to the biotech sector, Advanced BioPhotonics Inc. said it is settling a $4 million secured convertible notes offering.

The announcement sent the company's stock up 25%, with the stock gaining 4 cents to end at $0.20.

Four institutional investors agreed to buy the 8% notes, which mature in three years and are convertible into common shares at a 40% discount to the average of the three lowest trading prices for the 20 trading days before conversion.

So far, the company has received $1 million of the proceeds and will receive another $1 million once a registration statement is filed. The remainder will be disbursed within five days of the registration statement being declared effective.

The investors will also receive warrants for 4 million shares, exercisable at $0.65 each for five years.

Proceeds will be used for the commercialization of the company's BioScanIR System. The rest will be used for working capital.

"We believe that this financing gives us the working capital necessary to complete clinical testing at leading medical institutions within North America and Europe in exciting and important applications such as cancer therapy monitoring and reconstructive surgery," said the company's chief executive officer, Denis O'Connor, in a statement.

Based in Bohemia, N.Y., Advanced BioPhotonics develops medical imaging products using infrared technology to observe and measure changes in photonic activity within tissue.

Miramar to raise C$43.5 million

Miramar Mining said it has entered into an agreement with Newmonth Mining Corp. of Canada Ltd. whereby Newmont will buy 18.5 million units at C$2.35 each.

The units include one share and one warrant. The warrants are exercisable at C$2.75 each for four years.

The deal is expected to close Nov. 18.

Proceeds will be used for development on the Hope Bay gold production belt.

"We believe that this strategic relationship with Newmont is excellent added value for our shareholders," said Tony Walsh, the company's president and chief executive officer, in a statement. "Not only do we now have the financial resources to move Miramar closer to our goal of becoming an intermediate gold producer, but we have access to the in-house expertise of the world's largest gold producer [Newmont]."

The company's stock gained 17.65%, or C$0.30, to end at C$2.00 Wednesday after the deal was priced Wednesday morning.

Vancouver, B.C.-based Miramar is a gold exploration company.

Builders Energy plans C$20 million offering

In the energy sector Wednesday, Builders Energy Services Trust priced a C$20,002,500 deal comprised of 1.27 million trust units at C$15.75 apiece.

A syndicate of underwriters led by Canaccord Capital Corp. has an over-allotment option for up to 318,000 additional trust units.

The deal is slated to close Nov. 30.

Proceeds will be used for capital expenditures, acquisitions and general corporate purposes.

Based in Calgary, Alta., Builders Energy Services is an open-ended investment trust that acquires and operates subsidiaries that provide services to the oilfield sector.

The company's stock lost C$0.50 to close at C$16.30 Wednesday.

Another Calgary-based company, oil explorer Alberta Clipper Energy Inc., negotiated a C$12.25 million offering on Wednesday.

The company plans to sell 2.5 million flow-through shares at C$4.90 each through a syndicate of underwriters led by GMP Securities Ltd.

Alberta Clipper's stock slipped C$0.05 to close at C$3.85 Wednesday.

Pacific Ethanol stock up 2%

A day after announcing an $84 million private placement of convertible preferreds, Pacific Ethanol, Inc.'s stock gained almost 2% Wednesday.

The stock edged up 20 cents to finish at $10.30.

On Tuesday, when the placement was first announced and the company's third-quarter earnings report was released, the company's stock gained 12.35%, or $1.11, to close at $10.10.

The preferreds being offered by Pacific Ethanol are convertible into common shares at $8.00 each.

Fresno, Calif.-based Pacific Ethanol develops renewable fuels like bio-diesel.

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