Norex secures C$3.8 million financing; Rurelec plans stock sale; Precision to raise C$105 million

By Stephanie N. Rotondo

Portland, Ore., April 20 - Monday's private placement market saw most deals coming out of the mining and energy sectors.

Norex Exploration Services Inc. announced a non-brokered placement aimed at raising C$3.8 million. The company will sell stock to raise the funds.

Meanwhile, Rurelec plc is also planning a stock sale to raise £6.53 million. Proceeds will be used to refinance existing debt.

Precision Drilling Trust is planning a C$105 million private placement of units and warrants. The company is also planning a rights offering for existing investors and a debt placement.

Metanor Resources Inc. wrapped an upsized placement of units, according to a press release. The company raised more than C$13 million, up from the originally priced deal of C$12 million.

Norex announces equity financing

Norex Explorations Services is planning to raise approximately C$3.8 million in a non-brokered private placement of shares, the company announced.

The Calgary-based company will issue 15.18 million new common shares at C$0.25 per share, according to a press release. Norex has received commitments from ARC Energy Venture Fund 4 for C$3 million. Ravenswood Management Co. LLC, as well as certain officers and directors of Norex, have expressed interest in the remaining C$795,000.

Under the deal with ARC, Norex will issue warrants to the fund for no consideration. ARC will then exercise the warrants at C$0.25 to equal the committed C$3 million.

"The company has aggressively reduced its internal cost structures in the wake of current industry conditions," commented Paul Crilly, Norex's president and chief executive, in the release. "We have repaid $2.9 million in long-term debt in the first quarter with only $11.8 million of total long-term debt (including the current portion thereof) outstanding at March 31, 2009 together with a strong working capital position. We have renewed our credit facilities with our main lender, which includes an operating line facility for up to $15 million in addition to a $20 million revolving term facility. This financing together with our current credit facilities further strengthens our balance sheet while providing the capital to take advantage of growth opportunities at reasonable valuation levels."

Settlement is expected May 15.

Norex's equity (Toronto: NRX) closed unchanged at C$0.25.

Norex Exploration Services provides two- and three-dimensional seismic data services for mineral exploration companies.

Rurelec plans stock sale

Rurelec will sell approximately 81.6 million ordinary shares to raise £6.53 million, according to a press release.

Each share will be sold at 8p. Religare Hichens, Harrison and Daniel Stewart have conditionally placed the stock.

Furthermore, the deal is conditional upon Rurelec completing the sale of 50% ofs its interest to its former partner, Basic Energy.

Proceeds from the financing will be used in part to refinance Patagonia Energy Ltd.

Rurelec's stock (London: RUR) closed at 11.5p.

Rurelec is a London-based company engaged in the acquisition and development of power generation assets initially in markets in South America.

Precision to raise C$105 million

Precision Drilling is planning a C$105 million private placement of trust units and warrants, the company announced Monday.

The Calgary-based energy provider will sell 35 million of the units to the province of Alberta, represented by Alberta Investment Management Corp. The Canadian territory will also receive 15 million warrants exercisable for more trust units at C$3.22 per unit for five years.

AIMCo has also agreed to purchase C$175 million principal amount of 10% eight-year senior unsecured notes.

Additionally, the company is planning a rights offering for existing investors, in which it will raise C$103 million.

Precision plans to use proceeds form the financings to repay its C$296 million unsecured bridge facility loans.

"We are extremely pleased with our new relationship with AIMCo and the Alberta institutions which it represents," stated Kevin Neveu, president and CEO of Precision Drilling, in a statement. "We view AIMCo as a long-term partner which, through its $280 million investment in the Trust, sees the value in Precision's strategy to provide high value high performance drilling and well services globally. This integrated financing plan provides us with a reasonable cost of capital and removes many of the uncertainties associated with the Trust's existing credit situation."

"These uncertainties included potential higher interest carrying costs on the unsecured debt along with potentially higher original issue discounts on the unsyndicated portions of the secured facilities. This plan reinforces the Trust's liquidity, lowers debt levels, significantly reduces interest costs, removes the need for Precision to access high cost debt markets further and strengthens Precision's capitalization. The measures provide additional financial strength to comply with debt covenants and resources to fund operational and investment initiatives through the current economic cycle and the rebound that is anticipated to follow," Neveu said.

Precision's stock (Toronto: PD-UN) fell 41 cents, or 8.33%, to C$4.51.

Metanor closes unit placement

Metanor Resources closed the second tranche of a C$13.42 million placement of units.

The deal originally priced on March 5 for C$12 million with a C$6 million greenshoe. The second tranche included approximately 2.5 million units consisting of one common share and one half-share warrant. The units sold for C$0.50 and the whole warrants are exercisable at C$0.65 for two years. A total of C$1.25 million was raised.

The first tranche of the deal closed on March 20, with C$12.18 million being raised. All told, about 24.3 million units were sold.

Also, approximately 2.85 million of the units were part of the partially exercised greenshoe.

The company will use funds from the deal to fund a work program for the rehabilitation and improvement of the company's Bachelor Mine.

Metanor's equity (TSX Venture: MTO) slipped 2 pennies, or 3.77%, to C$0.51.

Calls seeking comment were not immediately returned Monday.

Metanor Resources is a Val d'Or, Quebec-based mining company.

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