Solar meltdown angers shareholders

Shares in an AIM-listed green energy company crashed yesterday to less than a third of the level at which its co-founder sold his entire stake five months ago.

Solar Integrated Technologies (SIT), a Los Angeles-based maker of solar roofing, saw its shares tumble 72.5p to a new low of 91.5p, valuing it at £30.6m after warning it expects to breach its credit arrangements.

On 31 January, the boutique investment bank Mirabeau placed almost 12.5 million SIT shares with institutions including Goldman Sachs, Artemis and the Swiss bank Pictet at 300p each on behalf of the company's co-founder, Edward Stevenson.

At the same time as Mr Stevenson cashed in his stake for £37.4m, he resigned as a director of SIT.

Since then, investors have been buffeted by a cold wind of unexpected, disappointing news, despite reassurances from the company that prospects look good.

In April, SIT warned it expected 2005 earnings to be "negative" after a costly expansion into Europe. Its full-year results were put back, and turnover fell shy of City expectations.

It is understood that after the latest bad news, angry SIT shareholders are demanding answers. The company will meet them in the coming fortnight.

Mirabeau, said to be deeply embarrassed by the performance of SIT's shares since the January placing, was trying to orchestrate a £25m fundraising for the company yesterday.

SIT proposed to amend its articles of incorporation at a shareholder meeting on 13 July to raise the maximum number of shares from 50 million to 250 million and issue up to 20 million common shares. That will form part of the fundraising.