TC PipeLines secures $600 million from PIPE; Worldstar Energy raises $10 million from stock sale

By Sheri Kasprzak

New York, Feb. 21 - TC PipeLines, LP grabbed PIPE headlines in a big way Wednesday with word that it plans to close a $600 million offering of limited partnership units following its acquisition of a general partner interest in Great Lakes Gas Transmission LP.

A group of investors led by Kayne Anderson Capital Advisors LP and Tortoise Capital Advisors and including TransCan Northern Ltd. agreed to buy 17,356,086 units at $34.57 apiece. The price per unit is a 4.3% discount to the company's $36.12 closing stock price on Tuesday.

Completion of the offering is contingent upon TC closing its acquisition of a 46.45% general partner interest in Great Lakes. The proceeds from the deal will be used to fund a portion of that acquisition, which is set to close by the end of the month.

The rest of the acquisition price will be funded by the company's $950 million senior revolving debt credit facility.

The news of the offering sent the company's stock up $1.24, or 3.43%, to close at $37.36 (Nasdaq: TCLP).

Calgary, Alta.-based TC acquires natural gas pipelines in the United States.

Meanwhile, in the oil exploration sector, Worldstar Energy, Corp. said a group of investors plans to buy $10 million in stock as part of its 2007 exploration program.

News of the deal comes even as oil prices slipped.

That shouldn't matter, said one market source, since oil companies are planning their upcoming exploration programs and need the money.

"I don't think one drop in oil prices will keep them [oil exploration companies] out of the market," he said. "They need the money too much, and that's what will keep them in the market. Acquisitions are certainly part of it as well, but either way, you're looking at a sector where the companies need money and they need it now while it's still early in the year."

In the Worldstar deal, investors plan to buy 4 million shares, but completion of the offering is contingent upon further negotiations.

The company's stock gained 7.7%, or 25 cents, to end at $3.50 (OTCBB: WSTR).

Also at Worldstar, the company closed a $5.5 million financing following the acquisition of a 51% indirect interest in 50 mineral licenses in Mongolia.

Vancouver, B.C.-based Worldstar is an oil and natural gas exploration company.

Bayou Bend stock slips

In secondary market news related to the oil sector, Bayou Bend Petroleum Ltd.'s stock dipped on Wednesday, a day after the company settled a C$200 million private placement.

The company's stock gave up 10 cents, or 5%, to close the day at C$1.90 (TSX Venture: BBP).

On Tuesday, the stock fell 5 cents to end at C$2.00.

In the placement, the company sold subscription receipts at C$1.20 each. The receipts are exchangeable on a one-for-one basis for common stock.

The offering was conducted as part of Bayou Bend's acquisition of Summit Energy Co., LLC.

Proceeds from the offering will be used to pay amounts due to vendors related to the acquisition and to acquire additional participating interests in the phase 1 area of the Marsh Island project. The rest will be used for drill programs and working capital.

Vancouver, B.C.-based Bayou Bend is an oil and natural gas exploration company.

China Precision Steel's deal

Elsewhere in PIPE news, China Precision Steel wrapped a stock offering for $20.8 million, selling 6,933,333 shares at $3.00 each to a group of institutional investors.

The agreement also included a make-good provision in which investors may receive another 2 million shares if the company's net income is less than $10.4 million for fiscal year 2007 or less than $12.5 million for fiscal 2008.

Proceeds will be used for a new production facility, debt repayment and working capital.

"This financing will help facilitate the expansion of our business," said Wo Hing Li, the company's chief executive officer, in a news release. "By June this year, we plan to begin production of our second cold-rolled mill with 150,000 tons of capacity."

On Wednesday, the company's stock gained 7.26%, or 64 cents, to settle at $9.46 (Nasdaq: CPSL) but lost 9.09%, or 86 cents, in after-hours activity.

Based in Shanghai, China Precision is a steel processing company.

IDM Pharma raises $12.9 million

Looking to the pharmaceutical sector, IDM Pharma, Inc. wrapped a private placement for $12,878,925.

The company issued to a group of investors led by Palo Alto Investors and Alta Partners 4,566,995 shares at $2.82 each.

The investors also received warrants for 782,568 shares, exercisable at $3.243 each. Each warrant was priced at $0.125 each.

The stock gained 7 cents, or 2.35%, Wednesday to settle at $2.95 (Nasdaq: IDMI).

"We are very pleased to welcome a new group of highly respected investors and to see the commitment of existing ones," said Jean-Loup Remote-Lemonne, IDM's CEO, in a statement. "The funds from this transaction should provide us with additional financial flexibility to support the development of our lead compound, Junovan, through the registration process by the regulatory agencies."

Located in Irvine, Calif., IDM is a pharmaceutical company focused on developing products to treat cancer.

Focus plans $6.3 million deal

In other PIPE news, Focus Enhancements, Inc. secured $6.3 million from a registered direct stock placement Wednesday.

A group of investors agreed to buy 5 million shares at $1.26 each and warrants for 500,000 shares. The warrants are exercisable at $2.00 each for five years.

The deal was set to close Wednesday.

The shares are being offered under the company's shelf registration.

Proceeds will be used for working capital and general corporate purposes.

The stock gave up 7 cents to close at $1.32 Wednesday (Nasdaq: FCSE).

Based in Campbell, Calif., Focus Enhancements converts videos from personal computers to television. The company also provides Ultra Wideband wireless services.

Airtrax's $3.73 million offering

Finally, Airtrax, Inc. closed a private placement of secured convertible debentures for $3,734,040.

The 18% notes are convertible into 8,297,866 common shares at $0.45 each. The debentures are due Feb. 20, 2009.

The investors received warrants for 8,297,866 shares, exercisable at $0.54 each. The investors also received callable warrants for 4,148,933 shares, exercisable at $0.75 each, and callable warrants for 4,148,933 shares, exercisable at $1.25 each.

First Montauk Securities Corp. was the placement agent.

"With investment funds being received, I believe that the implementation of our new business plan will be greatly facilitated," said Airtrax CEO Robert Watson, in a news release. "I believe the generation of new distribution channels, the heightening of our marketing presence with existing and potential customers, and the leveraging of our premium supplier relationships, will all be positively impacted by this transaction."

Airtrax's stock gained 4 cents, or 5.88%, to end at $0.72 Wednesday (OTCBB: AITX).

Located in Blackwood, N.J., Airtrax develops omni-directional wheels used in military and commercial applications.

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