This is meant do to one thing -- let the founders retain control while allowing for large stock acquisitions. It's possible Google was muscled out of the Whatsapp deal simply because they couldn't pony up the money. $20B is almost half of their cash on hand. Note that the Nest and Waze acquisitions (small in comparison) were paid for almost entirely in cash.
Bad news for Google shareholders in the long run. Companies with multiple share classes having different voting rights tend to underperform companies with stock that is one share, one vote.<p>Please note: that doesn't mean Google won't do well, but that on average it's likely to do worse for shareholders than if all stock had the same voting rights.<p>Since someone is sure to ask for a citation, <a href="http://irrcinstitute.org/news/multiclass-voting-companies-underperform-riskier_pr_10-02-2012.php" rel="nofollow">http://irrcinstitute.org/news/multiclass-voting-companies-un...</a> It's not the only study that has found this.
"Ownership" without control gives you precisely nothing, except for perhaps standing in a shareholder lawsuit. A company being unaccountable to its investors should make it unattractive as an investment.
"The much-awaited Google 2-for-1 stock split is finally happening on Wednesday when shareholders of record as of March 27 will get two shares for every one they owned."<p>Out of curiosity what happens if you bought shares on March 28th? Does your stock price just go to $600 or can you petition Google to have the new Class C shares issued to you to make up the loss in price?
If you're in GOOG options, it's going to get goofy.<p><a href="http://www.cboeoptionshub.com/2014/03/28/goog-get-ready-next-weeks-split/" rel="nofollow">http://www.cboeoptionshub.com/2014/03/28/goog-get-ready-next...</a>
Is it only in the US where it is allowed for stock shares to have no voting power?<p>Because I think this couldn't be done in HK or UK stock market.
Honest question: why do voting shares get traded at all? In most cases, several specific people will have majority control and will either retain it over time or deliberately give it to someone else. Sure, I can buy up a large portion of the stock, but for the most part, never a majority. So why bother trading voting stock at all? Or am I missing some power that a minority stakeholder can have with, say, 10% ownership?
I'm assuming they are also planning on buying back a chunk of the A-shares (and will only issue C shares in the future)? Will be interesting how much the price gap between A and C, or in other words the premium on control, will be.
Anyone know the tax implications of this? I have seen splits before but supposedly this was equivalent to a special dividend as the stock's value halves.
There seems to be a push to diversify and expand Google's income recently. Google Play Music All Access, Google Helpouts (20% cut), this stock change, Google fiber (while competitively priced, I expect there will be long-term profits), Google Glass, etc.<p>I have been noticing this and assume it's meant to help them fund their robotic and autonomous car projects. These are likely capital-intensive segments of the company.