China North East Petroleum Holdings Limited Raises $13.5 Million in Registered Direct Offering

Strategic Insights -

China North East Petroleum Holdings Limited, a leading independent oil producing and oilfield services company in Northern China, has secured $13.5 million in a registered direct offering. The company has sold 1,963,637 shares of its common stock at $6.875 per share to several select institutional investors. In addition to the shares, investors will receive warrants to purchase 392,728 shares of China North East Petroleum Holdings Ltd.'s common stock.

Key Takeaways:

  • China North East Petroleum Holdings Limited has entered into definitive agreements to sell 1,963,637 shares of its common stock at a price per share of $6.875.
  • The registered direct offering represents gross proceeds of approximately $13.5 million.
  • Investors will receive warrants to purchase 392,728 shares of China North East Petroleum Holdings Ltd.'s common stock, with an exercise price of $8.10 per share.
  • The warrants are exercisable beginning six months after the closing of the transaction and before the two and a half year anniversary of such initial issuance date.
  • The closing of the offering is expected to take place on or about Thursday, December 17, 2009, subject to the satisfaction of customary closing conditions.
  • The net proceeds from the offering will be used to redeem China North East Petroleum Holdings Ltd.'s 8% Senior Debenture issued to Lotusbox Investments Ltd. and for general working capital purposes.
  • The shares and warrants are being offered by China North East Petroleum Holdings Ltd. pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission dated September 9th, 2009.
  • Rodman & Renshaw, LLC acted as the exclusive placement agent for the transaction.
  • This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Statistics:

  • 1,963,637 shares of common stock were sold in the registered direct offering.
  • The total gross proceeds from the offering were approximately $13.5 million.
  • 392,728 warrants to purchase shares of common stock were issued to investors, with an exercise price of $8.10 per share.
  • The warrants are exercisable beginning six months after the closing of the transaction and before the two and a half year anniversary of such initial issuance date.
  • The closing of the offering is expected to take place on or about Thursday, December 17, 2009.
  • China North East Petroleum Holdings Ltd. plans to use the net proceeds from the offering to redeem its 8% Senior Debenture issued to Lotusbox Investments Ltd. and for general working capital purposes.

Sources:

  • "China North East Petroleum Holdings Limited Raises $13.5 Million in Registered Direct Offering", China Weekly News via VerticalNews.com, December 2009.
  • "China North East Petroleum Holdings Limited Form 8-K", Securities and Exchange Commission, September 9th, 2009.
  • "About China North East Petroleum Holdings Limited", China North East Petroleum Holdings Limited, undated.
  • "China North East Petroleum Holdings Limited Announces Acquisition of Song Yuan Tiancheng Drilling Engineering Co. Ltd.", China North East Petroleum Holdings Limited, undated.