GOOGLE HAS REORGANIZED itself into multiple companies, separating its core Internet business from several of its most ambitious projects while continuing to run all of these operations under a new umbrella company called Alphabet.
“What is Alphabet? Alphabet is mostly a collection of companies. The largest of which, of course, is Google,” Google co-founder Larry Page said in a blog post .“This newer Google is a bit slimmed down, with the companies that are pretty far afield of our main Internet products contained in Alphabet instead.”In other words, Google will continue to run internet-centric services such as Google Maps, YouTube, Chrome, and Android. But “moonshot” projects such as the X Lab and the Calico life extension project will operate as somewhat separate entities.
As for the actual structure of Alphabet, it will be comprised of a smaller version of Google, which will be slimmed down to include the company’s core businesses. According to Google CEO Sundar Pichai, these businesses include “search search, ads, maps, apps, YouTube and Android and the related technical infrastructure.” Alphabet will also contain other business like Fiber, Nest, and Calico.
Google shareholders will receive one share of Alphabet stock for every Google share they previously held. For those fearing a weird shakeup on Google’s masthead, you can relax; CEO Larry Page, CFO Ruth Porat, President Sergey Brin, Executive Chairman Eric Schmidt, and chief counsel David Drummond will all be retaining their positions at Alphabet.
Later this year, Google intends to implement a holding company reorganization (the "Alphabet Merger"), which will result in Alphabet owning all of the capital stock of Google. Alphabet will initially be a direct, wholly owned subsidiarGoogle. Pursuant to the Alphabet Merger, a newly formed entity ("Merger Sub"), a direct, wholly owned subsidiary of Alphabet and an indirect, wholly owned subsidiary of Google, will merge with and into Google, with Google surviving as a direct, wholly owned subsidiary of Alphabet. Each share of each class of Google stock issued and outstanding immediately prior to the Alphabet Merger will automatically convert into an equivalent corresponding share of Alphabet stock, having the same designations, rights, powers and preferences and the qualifications, limitations and restrictions as the corresponding share of Google stock being converted.
As for the actual structure of Alphabet, it will be comprised of a smaller version of Google, which will be slimmed down to include the company’s core businesses. According to Google CEO Sundar Pichai, these businesses include “search search, ads, maps, apps, YouTube and Android and the related technical infrastructure.” Alphabet will also contain other business like Fiber, Nest, and Calico.
Later this year, Google intends to implement a holding company reorganization (the "Alphabet Merger"), which will result in Alphabet owning all of the capital stock of Google. Alphabet will initially be a direct, wholly owned subsidiarGoogle. Pursuant to the Alphabet Merger, a newly formed entity ("Merger Sub"), a direct, wholly owned subsidiary of Alphabet and an indirect, wholly owned subsidiary of Google, will merge with and into Google, with Google surviving as a direct, wholly owned subsidiary of Alphabet. Each share of each class of Google stock issued and outstanding immediately prior to the Alphabet Merger will automatically convert into an equivalent corresponding share of Alphabet stock, having the same designations, rights, powers and preferences and the qualifications, limitations and restrictions as the corresponding share of Google stock being converted.
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