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What’s worse than getting getting ditched by a high profile customer the same week your company does an IPO? Having a series of class-action lawsuits continue to stamp on your newly public stock. That’s what’s happening to GT Solar.
The silicon solar gear maker went public two weeks ago, and after pricing its shares at $16.50, saw its stock close down almost 12 percent the day of its debut. Then the day after that, GT Solar’s shares slumped as much as 36 percent to change hands for $9.30 after it was revealed that customer LDK Solar had inked an agreement to buy equipment from GT Solar competitor JYT Corp.
And now things have gotten worse. Last Friday, law firms began filing a series of suits claiming that GT Solar didn’t properly disclose the risk of losing LDK’s business. GT Solar fell 10 percent today to close at $10.64.
The worst part about it, could be what the Boston Globe claims was the company’s IPO motivation:
GT Solar didn’t need money, choosing to go public only so private investors who bankrolled the company could cash out some of their investment. All $500 million raised in the IPO went to them.