Google to sell $2.5 of shares

Google chairman Eric Schmidt is to slash his stake in the search company by 42 per cent in the next year by selling $2.5bn worth of shares, the Financial Times reported.

News of the planned disposal came as Google’s shares hit a new high on Friday, ending the week at $785.3 and capping a gain of about 30 per cent over the past year.

Schmidt’s planned sale, which was disclosed in a filing with the Securities and Exchange Commission, will greatly speed up the rate at which he has been reducing his financial interest in the company he joined 12 years ago, and his influence over it. However, Google said he remained “completely committed” to it.

Based on the total shares outstanding at the end of last year, the disposals would leave Mr Schmidt with a 1.3 per cent economic interest and 5 per cent voting power, Google said.

Earlier big disposals prompted speculation that Mr Schmidt might be preparing to step down from the company, particularly after he handed over the chief executive title to co-founder Larry Page in 2011. However, in its filing, the company said the sales were being made “as part of [Mr Schmidt’s] long-term strategy for individual asset diversification and liquidity”.

Google said after the filing: “This is a routine diversification of assets and Eric remains completely committed to Google.”