High noon for CEO as Redstone asks for a few dollars more

NEWS Graham Cove, managing director and chief executive at Broadband pioneer Redstone Telecom, has given in to pressure to resign as the cash-strapped company goes cap-in-hand to the City. The move was widely predicted on Friday, as the company's share price collapsed. Once over 900p per share they were changing hands today for as little as 2p each. The company has taken out an emergency loan to keep the receivers out in the short term, and is aiming to raise further financing by issuing heavily discounted shares in a rights issue. Redstone is a pioneer of Symmetrical DSL, a local loop technology similar to ADSL, but more suitable for SMEs than domestic users. It connected its first trial customer in Portsmouth in April. In healthier times the company was hailed as a thorn in the side of BT and its stranglehold on broadband services. The company needs further financing to cover its mounting losses and complete its planned roll-out of broadband internet access across Fareham, Newbury, Cambridge, Nottingham and Southampton. Cove follows a quintet of former Redstone executives, including former finance director Alan Harrold who resigned in May following a 20 per cent collapse in the group's share price. In March, COO Glyn Thomas, group strategy and business development director Bob Cushing, and non-executive chairman John Carrington were ousted in March, in a move blamed on "market conditions".