Google Chairman Eric Schmidt’s Plan To Sell Huge Share Block ‘Routine,’ Company Says
By David Zielenziger | February 12, 2013 5:36 AM EST
Although Eric Schmidt, chairman of Google Inc. (NASDAQ:GOOG), the No. 1 search engine, has filed intentions to sell as much as 42 percent of his shares, the company said the move was “routine” and not a signal of plans to step down.
Last week, Schmidt, 57, advised the Securities and Exchange Commission he might sell as many as 3.2 million shares over the next year as part of a long-term strategy for “individual asset diversification.” The value of the shares is nearly $2.5 billion, based on their value in Monday trading.
The filing came shortly after shares of the Mountain View, Calif., company reached an all-time record price of $781.81. But the company said that had no bearing on Schmidt’s filing.
Recruited from Novell Inc. to be Google’s CEO in 2001, Schmidt, a computer scientist who’d also been chief technology officer of Sun Microsystems, served until April, 2011, when he handed over the CEO title to co-founder Larry Page, now 39. He serves as executive chairman, though retaining a major role in daily operations.
In early January, Google was advised by the Federal Trade Commission that a probe into its policies had been closed, although the company still faces scrutiny from the Department of Justice.
Schmidt has also used time recently for other activity, including writing “The New Digital Age: Reshaping the Future of People, Nations and Businesses,” with co-author Jared Cohen, head of Google Ideas. The book is scheduled to be published next month.
Analysts said they weren't surprised by the sales, noting they are routine. Kerry Rice, of Needham, said he would have been more concerned if Page had decided to cash out. Schmidt's moves may reflect his evolving role as chairman who's not so involved in dally activity.
Last month, Schmidt took a trip to North Korea with former U.N. Ambassador Bill Richardson and a small delegation that included his daughter, Sophie, who later posted her observations about it. The trip was unofficial and not sanctioned by the U.S. government.
Schmidt previously sold about 1.8 million shares over the past year, to raise about $1.2 billion, according to earlier filings. He’d still retain more than 1 percent of the company’s shares and with Page and his co-founder Sergey Brin, 39, would still retain voting control of the company.
The Google chairman is ranked 45th on the Forbes list of the 400 richest Americans, with an estimated net worth of $7.5 billion.
Shares of Google fell $776 to $777.61 in midday Monday trading. Over the past year, including dividends, they’ve gained about 28.3 percent.
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