The solar industry dealmaker of the year didn't warn us that prices would fall off a cliff -- and considering his company is among the highest cost vendors out there, probably wouldn't have wanted us to think that -- but he did sell a huge stake in his company at a premium to current share price ahead of the sector-wide carnage.
|SunPower CEO Tom Werner|
In fact, maybe SunPower's Tom Werner was listening to the ReneSola conference call. Remember, the day of the ReneSola conference call was April 28. The day that SunPower announced a sale of 60% of its shares to oil major Total (TOT)? You guessed it: April 28.
Putting those two April 28 events together sure gives solar investors a good rearview mirror look at what was about to occur. The truth is that Total had been scouring for a solar acquisition in North America for a few years, according to solar industry sources, so the date is a coincidence.
SunPower shares were sold by Werner to Total for $23.25 per share, a hefty premium to their $16.20 price at the time of the deal, but well below the $140 level reached at the high-water mark of solar investor euphoria.The current price for SunPower shares not owned by Total is under $6. When Total recently agreed to buy 18.6 million shares of SunPower in a private placement last week, the price was no longer $23.25, but $8.80. On that same April 28 date, First Solar held its first-quarter conference call and was asked about the SunPower-Total deal. First Solar executives said they were surprised. They weren't the only ones. Analysts in solar to this day would love to be able to answer the question: Was Werner just lucky, or did he pull off the solar coup of solar's first era? It's logical to ask if or why SunPower would have sold if they didn't see the solar bloodbath coming. Or, did Total come knocking after its multi-year search for a solar property had proved fruitless, and in moment of weakness, Werner opted for the balance sheet lifeline with the thought that the roof could cave in? It doesn't matter. Kudos to Tom Werner are in order, either way, in a year during which most solar CEOs waited too long to take action, and if they didn't suffer the fate of First Solar's Rob Gillette, are no more lucky for having to deal with the sector aftermath.
Eric Rosenbaum. >To follow the writer on Twitter, go to Eric Rosenbaum. Follow TheStreet on Twitter and become a fan on Facebook.
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