Google co-founders plan to sell $4.4B of stock

15.02.2015 14:23
Richard Waters in San Francisco

Google co-founders Larry Page and Sergey Brin have revealed plans to sell shares currently worth $4.4 billion over the next two years, in a move that would leave them little room for further sales without ending their combined control of the company.

The disposal plans, revealed in a regulatory filing, would leave the Google founders with barely half the shares they held when they took Google public in 2004. However, their remaining combined stake would still be worth nearly $45 billion.

The expected sales were disclosed as part of a 10b trading plan, under which executives report their intended disposals but give up control over the timing of when the sales are made.

Mr Brin and Mr Page control Google through a special class of shares that gives them 54.6 percent of the voting rights, even though their economic interest is only 13.1 percent. After the latest sales, their voting control will fall to only 52 percent, Google said.

The company issued a new class of non-voting C shares last year in a move to protect the founders’ control over the long term. The new shares are expected to be used to fund acquisitions and employee stock plans without diluting the founders’ control.

Google also at first proposed that Mr Brin and Mr Page – who hold half their stake in the form of the C shares – should be free to sell this class of stock to raise cash if they wanted. However, an investor lawsuit forced a settlement in which the founders agreed to sell their super-voting shares in equal proportion to the C stock, leaving them facing dilution to their control if they continue to make big disposals.


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