Google has announced plans to issue a new class of stock to existing shareholders. Normally, a stock split is viewed positively by shareholders and the Street because it implies the company expects the stock to continue to grow. However, the way Google has structured this split has raised eyebrows among corporate governance watchers. “It is an unusual and unique structure, and I can understand why it has made some people unhappy,” said Sris Chatterjee, a professor of finance and business economics at Fordham University. “It is viewed as undemocratic and giving a few people entrenched corporate control of Google.”
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Google Split Preserves Founders' Power
Posted by: Erika Morphy April 16, 2012 09:44 AMGoogle has announced plans to issue a new class of stock to existing shareholders. Normally, a stock split is viewed positively by shareholders and the Street because it implies the company expects the stock to continue to grow. However, the way Google has structured this split has raised eyebrows among corporate governance watchers. “It is an unusual and unique structure, and I can understand why it has made some people unhappy,” said Sris Chatterjee, a professor of finance and business economics at Fordham University. “It is viewed as undemocratic and giving a few people entrenched corporate control of Google.”