Solar Tracer at the Penny Stock Arcade
Sometimes you should listen to your Google.
That last is not hyperbole – Sector 10 hasn't brought in any revenue for over a year. It's a stock market trick old as time, a shell buying an operating company so the latter can go public at low cost.
But why? Why would Solar Tracer want to go public sub rosa? (Full disclosure. I own no penny stocks. I did have some AIG once, before that went into penny territory. I bought in at $60. If you are looking for investment advice, move along.)
Turns out Solar Tracer is run by the Tedrow brothers of Florida. CEO Christian is a writer, CFO Tyler a venture capitalist. The two have been working on a thriller called the Judgement Trilogy – they write under the name Thomas Tedrow.
Tyler is managing partner of HART Capital Management in Orlando, which describes itself as “a new kind of venture capital firm.” Among its listed investments is ChinaPharmaHub, for which Christian (left) sits on the business advisory board. ChinaPharma says it is interested in identifying and bringing to market interesting drugs from China.
Now that you know something about the management, what would you be buying, if you were interested in buying into this? Mainly Eugene Augustin, an expert on microwave antennas last seen in July selling his solar antenna expertise to Lady Bug Resource Group, a Kirkland, Washington based outfit that apparently held the URL Newsolartec as a subsidiary. Christian Tedrow was listed as the owner of that URL until last week, when it expired.
After buying Augustin's expertise, in November, LadyBug named a Thomas F. Krucker its new CEO. Krucker is a former Toyota executive. Inside of a month Krucker bought MAG International, which said it was developing electric off-road vehicles (its Web site was recently disabled.
So what's going on?
Near as I can determine the Tedrows needed a new vehicle after LadyBug flew away. That's what Sector 10 is, a company that owns what was NewSolarTec but is now called Solar Tracer.
Back when the LadyBug deal got done, Solar Thermal Magazine ran a piece on the Tedrows, and New Solar. In that piece Christian Tedrow described the Solar Tracer as a solar concentrator that can heat water into steam for generating electricity.
There's nothing new here. Solar concentrators are old tech. There are breakthroughs going on here but little evidence Mr. Augustin has one.
Still, shares in Sector 10 doubled in value, to 1.8 cents per share , on the day after the Tedrow news broke. OTC Picks featured the company without knowing they were out of the emergency response business. Their story paints the company as an emergency preparedness play.
I'm guessing this is another ride on the penny stock arcade that's going to end in tears.
But it would be so much fun to be proven wrong.
Dana Blankenhorn first covered the energy industries in 1978 with the Houston Business Journal. He returned last month after a short 29 year hiatus because it's the best business story of our time. In between he covered PCs, the Internet, e-commerce, open source, the Internet of Things and Moore's Law. It's the application of the last to harvesting the energy all around us he's most excited about. He lives in Atlanta.