Some Shareholders More Equal Than Others

NEW YORK ( TheStreet) -- Sometimes a stock split is not just a stock split. Take Google ( GOOG) and its peculiar, self-serving, so-called split.

The New York Post -- and plenty of other media outlets -- treated it like any other. They merely said: "The company also approved a two-for-one stock split." As if it were any old stock split. As if.

The New York Times ( NYT) went the same old route in their headline, merely saying: "Google Announces 2-for-1 Stock Split." Way down low in the article, they touched upon a difference:

"The new shares will trade alongside the current shares on the Nasdaq exchange, identical except for their lack of voting rights."

But the Times then immediately swallowed the Google party line that the purpose of this untraditional arrangement was simply harmless and innocent:

"While a purpose of the new shares will be to make acquisitions, Mr. Page said that did not mean any deals were being planned at this time." Uh, is that all?

The Financial Times did a better and more thorough job. They started with the headline: "Google announces unusual stock split."

Immediately, The Financial Times rightly termed Google's arrangement "a departure from normal practice." Making clear that the company was issuing a powerless non-voting share for each existing one, The Financial Times zeroed in on the impact: the arrangement would effectively hand Google creators lifetime control. Sorry, New York Times, this goes beyond creating a means for acquisitions. Google's leaders have seized permanent control of the company.

You can debate the wisdom of that. Actually, you can't unless you point out why this split is different from all others.

At the time of publication, Fuchs had no positions in any of the stocks mentioned in this column.

Marek Fuchs was a stockbroker for Shearson Lehman Brothers and a money manager before becoming a journalist who wrote The New York Times' "County Lines" column for six years. He also did back-up beat coverage of The New York Knicks for the paper's Sports section for two seasons and covered other professional and collegiate sports. He has contributed frequently to many of the Times' other sections, including National, Metro, Escapes, Style, Real Estate, Arts & Leisure, Travel, Money & Business, Circuits and the Op-Ed Page.

For his "Business Press Maven" column on how business and finance are covered by the media, Fuchs was named best business journalist critic in the nation by the Talking Biz website at The University of North Carolina School of Journalism and Mass Communication. Fuchs is a frequent speaker on the business media, in venues ranging from National Public Radio to the annual conference of the Society of American Business Editors and Writers.

Fuchs appreciates your feedback; click here to send him an email.

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