THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, August 21, 1996 TAG: 9608210986
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: ASSOCIATED PRESS
DATELINE: STERLING, VA. LENGTH: 50 lines
Stockholders in Oliver North's bulletproof vest company have taken a direct hit lately as the value of the newly issued stock dropped nearly 70 percent.
North started Guardian Technologies International Inc. after he retired from the Marine Corps amid disclosures of his role in the Iran-Contra scandal.
Guardian went public in May with an offering price of $5.10 per share.
But in the past month the firm's stock sank 69 percent from a high of $6.50 per share to $2 in mid-day trading Tuesday.
The stock had record trading volume last Wednesday when Guardian filed a financial report for the quarter ended June 30.
Its sales rose 59 percent to $329,000 from $206,000 in the same quarter of 1995, but losses in the same period widened by 84 percent, from $137,000 last year to $253,000.
The loss was caused in part by the actions of a securities firm that held a large portion of Guardian's stock. Landmark International Equities was theinvestment banker for Guardian's initial public offering on May 14 and it handled most of the trading in Guardian stock until this month.
When the price of Guardian shares started to slip earlier this summer, many investors sold. Under rules of the Nasdaq market, Landmark was obligated to buy unwanted shares.
Saddled with a growing percentage of Guardian stock that was worth less and less, Landmark pulled the plug on Aug. 7. The firm dropped out as Guardian's Nasdaq market maker after losing about $1.7 million on Guardian stock and a couple of other stocks the firm traded, Dow Jones News Service reported.
Landmark's exit caused the stock to plunge from $4 a share to $2 a share in a matter of minutes.
A Landmark spokesman said the company is raising additional capital and hopes to resume its role in offering Guardian shares soon.
Guardian released a statement a day after the $2 drop in its stock saying it was ``not aware of any business event or action on the part of the company that would explain the recent drop in the price of its securities.'' The statement did not mention Landmark. Guardian co-founder Joseph Fernandez said he cannot expand on that statement.
North continues as president of the company. He has declined media questions about the company since the initial public offering and did not immediately return a telephone call requesting comment Tuesday.
During his failed 1994 campaign for Senate in Virginia, North touted the firm as an example of his perseverance and business acumen.
``I've met a payroll, I've run a business,'' North said then. ILLUSTRATION: Oliver North by CNB