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Google Leaders Selling Shares

Analysts See No Red Flags as Officers Convert Paper Assets

By David A. Vise
Washington Post Staff Writer
Thursday, March 17, 2005; Page E04

Google Inc. co-founders Sergey Brin and Larry Page, and other senior company executives, have sold more than $500 million worth of stock in the Internet search firm over the past several months, according to regulatory filings.

Brin and Page have been the biggest sellers of stock, though their sales represent only a minuscule portion of their overall holdings in the company, the leader in helping computer users find information on the Internet. Their sales have been made in a scheduled fashion under preapproved selling programs designed to insulate executives from claims they are timing sales based on confidential information not available to other investors.

Google co-founders Sergey Brin, left, and Larry Page have sold stock worth a combined $424.8 million in recent months. Given their holdings, that's not much. (Michael Probst -- AP)

Insider Trades Google stock transactions over the past several months.
Track Google's Stock: GOOG
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Beginning in January, and continuing in early February and early March, Brin sold a total of 1.03 million shares of Google, at prices ranging from a low of $180.25 to a high of $205.75. The sales raised $198.3 million, according to filings with the Securities and Exchange Commission, compiled by Thomson Financial.

Page sold a total of 1.2 million shares, unloading three equal blocks of 400,000 shares in December, January and February. His sales, at prices ranging from a low of $169.50 to a high of $205.08, raised a total of $226.5 million, according to SEC filings.

The third member of the triumvirate that runs Google, chief executive Eric E. Schmidt, sold 339,243 shares in late December, January and February, at prices ranging from $185.62 to $199.44. His sales raised a total of $65.8 million.

Google stock, which hit a high of $216.80 on Feb. 2, has pulled back to a trading range in the $170s since, as the Internet sector experienced a downdraft on Wall Street. Google stock yesterday fell $3.01 to close at $175.60, down 1.7 percent. The company first sold shares to the public last August for $85 each.

Wall Street analysts said the stock sales by top Google executives were not surprising, since virtually all of their money is tied up in the company and financial advisers typically advise clients to diversify their holdings. However, Youssef Squali, an analyst with Jefferies & Co., said the total dollar value of Google stock sold over the past several months by senior executives is staggering by normal standards.

"There goes the Northern California housing market," Squali quipped. "It is a lot of money."

But for Brin and Page, two of only 29 billionaires under the age of 40 included in Forbes magazine's billionaires list this week, most of their net worth remains tied up in Google stock. Compared with last year, they moved up almost 500 spots on the Forbes list to 55, with each estimated to have a net worth of more than $7 billion. All of that wealth has been accumulated through the rapid growth of Google, the globally popular firm they started seven years ago that profits by serving up ads linked to the free search results provided to computer users hunting for information online.

Google's success has made numerous other executives at the firm rich, too, and they are turning their paper wealth into cash, recent stock sales show. For example, Omid Kordestani, senior vice president for worldwide sales at Google, sold $66.5 million worth of stock in February and March. Wayne Edward Rosing, senior vice president of engineering, who has regularly sold shares every few weeks since mid-December, unloaded more than $15 million of stock. Meanwhile, Google's top attorney, General Counsel David C. Drummond, who simultaneously serves as vice president of corporate development, sold about $15.5 million worth of stock in February and March. Chief Financial Officer George Reyes sold $9.8 million of stock, while Jonathan J. Rosenberg, vice president for product management, sold $11.5 million of Google shares. Shona L. Brown, vice president for business operations, sold $3.3 million of shares.

In February, three members of Google's board of directors also cashed in. L. John Doerr, the best-known partner at one of two major Silicon Valley-based venture capital firms that backed Google, sold $29.9 million worth of stock, while an earlier-stage investor, Ram Kavitark Shriram, sold $47 million of stock in February. John L. Hennessy, president of Stanford University and a computer science maven, sold $514,778.

"To most humans, this is an unfathomable amount of money being generated as a result of these sales. To these folks, it really amounts to percentage points of their ownership," said Scott Kessler, an equity analyst with Standard & Poor's.

Kessler said he sees no red flags in the Google stock sales, meaning he does not believe they signal a loss of confidence in the company's prospects by its senior management or early backers. He also noted that some major institutional investors, including FMR Corp., better known as Fidelity Investments, and Legg Mason Inc., have been buyers of the shares. Google declined to comment on the stock sales.

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