In 2015, Google declared that the company is restructuring into various parts, with a company called Alphabet to manage all of Google’s multiple businesses. The reason behind the step was to actually separate out some of Google’s “Other Bets” projects into their own existence so that they would be valued separately from the Google business.
Now, the parent company, Alphabet Inc. is developing a new holding company meant to conclude from Google into a corporate parent with different arms that shield individual entities in areas like health care and autonomous cars.
The new business called as XXVI Holdings Inc. will have a share in the equity of each of Alphabet company, including Google. The restructures form separates Google from other entities such as Waymo, it autonomous car unit, and Certainly, a medical device and health data company.
On the other hand, Google is also converting from a corporation to a limited liability company or LLC.
“By separating them, it allows the parent company to limit the exposure of the various obligations of the LLCs,” Dana Hobart, a litigator with the Buchalter law firm in Los Angeles, said. “For example, if one of the LLCs has its own debt, only that LLC will end up being responsible for payment of that debt.”
“We’re updating our corporate structure to implement the changes we announced, with the creation of Alphabet in 2015,” said Gina Weakley Johnson, an Alphabet spokeswoman. She termed the method a legal formality that won’t affect ultimate shareholder control, operations, management or personnel at the 75,606-person company.
XXVI, the new holding company, is the number of letters in the alphabet expressed in Roman numerals.
“I still see amazing opportunities that just aren’t quite fully developed yet — and helping to make them real is what I get excited about,” Page wrote in a letter last year about Alphabet. Google accounted for 99 percent of Alphabet’s revenue previous quarter.
The new formations were revealed in a filing on Friday with the Federal Communications Commission.
“As a result of the corporate reorganization, Alphabet and Google will be able to operate in a more efficient, economical, and transparent manner, allowing the companies to concentrate on their revenue generating activities,” the company said in the filing.