Why Google is planning to split its stock

Google’s shareholders are expected to approve today the company’s plan to issue a new class of stock. Google’s co-founders, Larry Page and Sergey Brin, and Executive Chairman Eric Schmidt are pushing for the move to ensure that they maintain long-term control of the company. The plan is expected to pass because Page, Brin and Schmidt have most of the voting power. The proceedings are on the agenda today at Google’s annual shareholders meeting at its headquarters in Mountain View, Calif. Once approved, the new class will effectively split shares 2 to 1. It’s an unusual approach that reflects a desire by Google’s founders to preserve the company’s long-term interests. The new shares won’t have any voting power. Employees given Google stock in the future will get the non-voting stock, allowing voting power to remain with existing shareholders. The same will hold true for companies that Google buys using its stock. The Associated Press has compiled a complete Q&A to explain Google’s stock split and the strategy behind it here.