Google staff morale rocked by news of IPO winners and losers
The famously collegiate culture of the internet search wizard Google could be threatened by an American securities rule which forces the company to reveal who was awarded handsomely in its IPO last year and who missed out.
The famously collegiate culture of the internet search wizard Google could be threatened by an American securities rule which forces the company to reveal who was awarded handsomely in its IPO last year and who missed out.
Google falls under a rarely invoked regulation which requires it to report not only the stock sales of its most senior executives, but also those of hundreds of employees who have sold as little as five shares since last August, when Google staged the most successful dot.com IPO for years.
The level of transparency has shown up the disparities between who was awarded generous amounts of shares ahead of the IPO, and who was not, in many cases because they joined the California-based company at a later stage than others.
So far, Google's filings with the Securities and Exchange Commission have disclosed share sales by 400 of the company's 3,000 employees. The majority of sales were by Google's founders, Sergey Brin and Larry Page, who have been made multimillionaires by their invention of a world-class computer search engine. Eric Schmidt, the chief executive, also cashed in a substantial amount of this holding.
But a pattern of less elevated employees becoming millionaires, at least on paper, has emerged, in a move which could undermine Google's university campus atmosphere. An insider told reporters: "The whole culture's really strange when there are two people in the same cubicle and one's worth $1m and the other is worth nothing."Google declined to comment.
Companies can avoid reporting restricted stock sales, but only if they do not breach a cap on the amount of shares sold. Google has exceeded that amount, triggering the need for extra disclosure.
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