Employees working in technology company’s like Google get many benefits other than working in an exciting work environment. Competitive salaries and stock option are very common for team members that have joined a startup in its early stages and if a venture is successful these shares can be worth million. Eric Schmidt, executive chairman of Google, owns a large chunk of shares for the company that he runs and the latest reports state that he may be looking to sell almost 42 percent of his total holding. The move is part of a stock trading plan that will help the influential technology leader diversify his portfolio and prevent any ups and down in his company stock from adversely effecting his overall net worth.
Schmidt’s plans were revealed in a filing with the United States Securities and Exchange Commission that Google submitted on Friday, February 8. In the papers it was made clear that by the end of 2012 the Google executive held about 7.6 million shares of both class A and class B common stock. However, Schmidt had accepted a new trading plan in November of 2012 that gave him the choice to sell 3.2 million shares of class A common stock starting February 2013.
Google’s filing stated that the idea behind the trading plan was to give Schmidt the chance to diversity his investment portfolio an absorb any adverse price swings. He will have the option of making stock trades over one year to help diversify his portfolio. According to Google, the 7.6 million shares are almost 2.3 percent of the company’s entire outstanding capital stock and gives Schmidt an 18 percent vote.
If Schmidt chose to sell his 3.2 million shares at the week ending price of $785.37, he can make up to $2.5 billion.
Greg Sterling, a senior analyst with Opus Research, says that just because Schmidt has the option to sell the shares right now does not mean he will. However, Sterling believes that the Google head will “cash out a little.” he also adds, “I wouldn’t be surprised if he departs within 12 to 24 months,” the analyst said. Schmidt has been an integral part of Google’s team and has played an important role with the company’s dealing with foreign governments. Sterling thinks that it can easily be seen how the business leader may leave the company and move into a more official government role as diplomat or ambassador.
With the amount of money that Schmidt can make off the sale of stock he could even choose to just lay back and enjoy.
Source: Computer World
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