Eric Schmidt, Google’s outgoing CEO, to cash out shares worth $335 million
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Google Chief Executive Eric Schmidt, who is stepping down in April, is planning to sell 534,000 shares in the company over the next year in a cash-out move that could be worth about $335 million.
Schmidt has been CEO at Google for the last decade. But in April he’ll be replaced by Larry Page, the company’s co-founder.
Word of Schmidt’s plan to sell off a portion of his holdings in the Web search giant came in a regulatory filing alongside Google’s fourth-quarter earnings report, both submitted to the Securities and Exchange Commission.
According to the Google SEC filing, Schmidt owned 9.2 million shares in Google as of Dec. 31, 2010. Google stock closed at $626.77 a share on Thursday, down $4.98 a share.
At Thursday’s closing price, Schmidt’s holdings in Google are worth about $5.8 billion.
Google said in the filing that Schmidt is planning to sell 6% of his shares over the next year in an already-mapped-out trading plan. At Thursday’s closing price, the 534,000 shares would be worth about $335 million.
‘The pre-arranged trading plan was adopted in order to allow Eric to sell a portion of his Google stock as part of his long-term strategy for individual asset diversification and liquidity,’ Google said in the filing. ‘Using this trading plan, Eric can diversify his investment portfolio and can spread stock trades out over a period of one year to reduce market impact.
‘Because this trading plan was established well in advance of a trade, it also helps avoid concerns about whether Eric had material, non-public information when he made a decision to sell his stock.’
Google said in the filing that, as of December 31, 2010, Schmidt’s 9.2 million shares represented about 2.9% of Google’s outstanding capital stock and approximately 9.6% of the voting shares in the company.
The trading plan calls for Schmidt to reduce his ownership stake to about 2.7% of Google, about 8.7 million shares overall and about 9.1% of Google’s voting shares, ‘assuming no other sales and conversions of Google capital stock occur,’ the filing said.
In after-hours trading, Google stock jumped to $635.50.
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-- Nathan Olivarez-Giles