Submitted by Fox First at Ten on June 21st
MOUNTAIN VIEW, Calif. (AP) - Google's plan to issue a new class of stock will be among the items considered at the search leader's annual shareholders meeting Thursday.
The new shares won't have any voting power, however, and would help Google's senior leaders keep control years from now. Employees given Google stock in the future would get the non-voting stock, allowing voting power to remain with existing shareholders. The same would hold true for companies that Google buys using its stock.
Without change, senior leaders worry that they would eventually lose their voting power. Since it went public in 2004, Google's founders have emphasized a need to insulate management from short-term pressures.
Under the plan, all current stockholders would get one share of the new Class C stock for each share they now own. This effectively splits Google's stock price in half. The new stock would trade independently under a separate ticker.
The plan is expected to win approval because co-founders Larry Page and Sergey Brin and Executive Chairman Eric Schmidt, who have most of the voting power, support it.
When the split happens, the value of existing shares will be split into two, so half remains with the existing Class A shares and the remainder will be with the new Class C shares. Investors will have twice the number of shares than they had before, but the total value and voting power won't change. In other words, 100 shares worth a total of $60,000 will become 200 shares still worth $60,000 and carrying 100 votes.
The shareholders meeting takes place at Google's headquarters in Mountain View, Calif. It starts at 2 p.m. PDT.
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