Deals
A123 Systems

A123 Gets $200M Convertible Jolt from Wanxiang Group

By |

Battery maker A123 Systems (AONE) agreed to receive a $200 million convertible debt infusion from China-based auto parts conglomerate Wanxiang Group Corp. It was the fifth PIPE offering from A123, which has raised $110 million in previous debt and equity placements. Complete conversion of debt and exercise of warrants would result in the issuance of 80% of the company’s stock to Wanxiang, according to a release. Wanxiang also extended a $75 million bridge loan. Waltham, Mass.-based A123 makes nanophosphate lithium iron phosphate batteries and electrical storage systems. The company has been struggling this year, beset by lagging earnings and a battery recall.

Legal

SEC Sanctions, Sues China Yingxia Players

By |

Two years after the CEO of China Yingxia International Inc. (CYXI) was sentenced to death in China, company affiliates and promoters are being sanctioned by the Securities and Exchange Commission for wrongdoing including illegal issuances of stock. Nutraceutical maker China Yingxia went public in the U.S. via a 2006 reverse merger. The company raised $10.73 million in a 2007 common stock PIPE placed with investors including Endurance Partners, Guerilla Capital, JMG Capital, and Heller Capital. China Yingxia was a Florida corporation headquartered in Harbin, China with what the SEC calls "purported” operations in China. The SEC has announced separate settlements with consultant James Fuld, Jr., consultant and communications representative Peter Dong Zhou, unregistered broker Steve Mazur, and Peter Siris and his Guerrilla Capital and Hua Mei 21st Century entities.

Markets
AMRS

Patient Investors Fuel Amyris

By |

An emerging growth company can never have enough friends, especially when its stock price has plunged 70% since the beginning of the year and its burn rate has nearly doubled in a matter of months. But lucky for Emeryville, Calif.-based Amyris (AMRS), an alternative energy issuer that can claim the aforementioned stats, it has a lot of faithful followers, including a sheikh, a staunch venture capitalist and French behemoth Total Group. The company is developing a technology that involves reprogramming living cells like yeast to perform chemical transformations on an industrial scale. Amyris has biotechnology roots, and lately it has been spending like a biotech. It went through $154 million over five quarters ended March 31 this year, up from $85 million over the previous five quarters.

Legal
GEOI

GeoResources Warrant Holders Could Miss Merger Gold

By |

The impending merger of GeoResources (GEOI) with Halcon Resources Corp. could generate huge returns for risk arbitrageurs, but warrant holders from a 2008 PIPE may not fair so well. After the two Houston-based energy explorers announced Halcon’s acquisition bid in April, the news was followed by the usual gnat storm of law firms announcing “investigations” or lawsuits. While GeoResources has disclosed the resolution of one such suit and said it will not affect the merger, a less well-known legal dispute pits GeoResources against owners of warrants originally priced at $32.43. The derivative paper was issued in a June 2008 PIPE where GeoResources sold $34.5 million in stock and warrants to investors including Waterstone Capital Management, UBS O’Connor, Hudson Bay Capital, Ramius, Crestview Capital Partners, and Atoll Asset Management. The warrants featured anti-dilution provisions that required them to be repriced to lower levels and increased in number in step with future issuances, but investors have filed a lawsuit alleging that GeoResources refused to reprice some 500,000 warrants after the company issued lower priced securities in 2009 and 2011.