Google is restructuring with Sundar Pichai as new CEO; shares shoot up after ‘Alphabet’

In order to restructure and reorganise, Google is creating a new publicly traded parent company called Alphabet Inc. Alphabet will be run by Google co-founders Larry Page and Sergey Brin. Google will become a subsidiary of Alphabet with a new CEO, Sundar Pichai.

Today Google co-founder Larry Page announced a massive restructuring of the company through a blog post. Page said in his blog post that, “Alphabet is about businesses prospering through strong leaders and independence.” He further expressed that creation of Alphabet is a very exciting new chapter in the life of Google. Larry Page will be the CEO of Alphabet and co-founder Sergey Brin will serve as a President.

Page clarified on the blog post that, the capital allocation and execution of each business will be rigorously monitored and controlled by the founders themselves. Google’s chairman, Eric Schmidt, will transition to the same role at Alphabet. Alphabet Inc. will be the publicly traded company, replacing Google’s shares. Google’s financials will be reported separately from the rest of Alphabet.

Sundar Pichai will replace Larry Page as Google’s CEO. Under Pichai Google will be “slimmed down” and search focused. Google will exclude companies that are not part of its core Internet business. Google’s business will include search, ads, maps, apps, YouTube and Android and the related technical infrastructure. Pichai previously served as senior vice-president of product at Google. Page said Pichai was the natural choice to lead Google.

Under the umbrella of Alphabet, Google will remain the largest subsidiary along with its various offspring. The new company will include Google’s health effort, life Sciences, and longevity research wing Calico. They will be separated from the main Google business under Alphabet. X lab, Nest and Fiber will also become its own company. Additionally, Ventures, Capital, Sidewalk and Wing will also become separate companies under Alphabet’s umbrella. In Alphabet each operation will have its own CEO and leadership.

The announcement of the restructuring of the company shooted shares up about 6 percent in extended trading. With that jump in the company’s shares, Google added more than $20 billion to the company’s market capital, reports Tech Crunch.

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