What does it mean to re-classify equity with a class structure?

It is a juggling game in which the founders of the company can keep control and still give away economics tied to the equity like dividends etc.

Berkshire, Google, Alibaba have all done it in the past. Now facebook also has decided to do the same.

Facebook currently has a dual-class structure: Class A shares, which are what trade under the ticker "FB" on public markets and have one vote per share, and Class B shares, which have 10 votes per share and is what company insiders own. The Class B shares don't trade on an exchange.

Now, for each outstanding Class A and Class B share held by our stockholders, Facebook intends to issue two new Class C shares as a one-time stock dividend. The Class C shares will have the same economic rights as the existing Class A and Class B shares. The primary difference is that the Class C shares are non-voting.So in effect FB has split 3:1.

There will also be a new ticker for the Class C stock that will trade on the exchange.

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