Shares of Array Technologies (ARRY 0.70%), which produces equipment and software that enable solar panels to "track" the movement of the sun and thus optimize energy production, are in freefall Tuesday, falling 11% through 3:20 p.m. EST.
You can blame hedge fund Oaktree Capital Management for that.
Yesterday after close of trading, Array announced that one of its stockholders, controlled by Oaktree, is selling at least 25 million shares of Array, and perhaps as many as 28.75 million shares.
No price has been announced for the sale, but the sheer number of shares being unloaded -- as much as 22.6% of all shares outstanding -- appears to be enough of a shock to scare investors away, even without additional details on how the Array stock is (perhaps) being sold at a below-market price.
Notably, because this is a sale by Array "insiders," and not by the company itself, Array will receive no cash from this stock sale. (Not that it needs any more cash. Array has essentially no long-term debt and $27 million in the bank already.) And on the plus side, because this is a sale of existing stock, and not a new issuance that would dilute existing shareholders, there will also be no share dilution of outside investors.
In short, there are minuses but also pluses to this news -- but today, investors are seeing only the minuses.