Google founders to surrender majority voting rights in 5 yrs
Last updated: 24 January, 2010
New York, Jan 24 (PTI) 11:23 IST
Larry Page and Sergey Brin will be selling ten million shares of Google in the next five years, a move that will see the duo giving away their majority voting rights in the online search engine they co-founded in 1998.Currently, Page and Brin together have about 59 per cent of the total voting rights in the Internet behemoth.
The planned sale of shares would bring down the voting rights of the two founders to 48 per cent, Google said in a filing to the US Securities and Exchange Commission.
Currently, Page and Brin hold nearly 57.7 million Class B shares, representing about 18 per cent of its outstanding capital stock and "approximately 59 per cent of the voting power of Google's outstanding capital stocks".
The Internet giant, which went public in 2004, has two types of stocks-- the Class A stocks which are traded on the Nasdaq, and the Class B shares kept aside for the company insiders and have ten times more voting rights than the Class A stocks.
"As part of a five-year diversification plan, Larry (Page) and Sergey (Brin) each intend to sell approximately five million shares," the Google filing said.
Once the proposed sale is completed, the duo would have about 47.7 million Class B shares, accounting for nearly 15 per cent of Google's outstanding capital stocks and "approximately 48 per cent of the voting power of the outstanding capital stock," it added.
Currently, Page is the president for products and Brin is the president for technology. The Google filing further said the plans to sell portion of their shares were adopted as part of the duo's respective long-term strategies for individual asset diversification and liquidity.
These stock trading plans, which were adopted on November 30, 2009, would also help in spreading out share trades over an extended period of time to reduce adverse market impact.
"Because these plans were established well in advance of a trade, they also help avoid concerns about whether these officers had material, non-public information when they made a decision to sell their stocks," a Google spokesman said.
On January 22, Google shares closed at USD 550.01, down 5.6 per cent on the Nasdaq, despite a fivefold jump in its fourth quarter profits to USD 1.97 billion on a revenue of USD 6.67 billion, following a massive fall of the Wall Street on the day.