A Canadian e-commerce giant Shopify has announced a 10-for-1 stock split on Monday, joining a growing list of companies that have divided their shares to make them more appealing to investors.
Shopify also announced that it will seek shareholder approval to provide Tobi Lutke, the company’s chief executive officer and founder, with a new class of shares known as the Founder share.
The plan aims to protect Lutke’s voting power by giving him a variable number of votes on the Founder’s share, which, when coupled with his previously acquired shares from other classes, would give him 40% of the total voting power linked to all of Shopify’s existing shares.
Shopify Stock Split
Shopify’s stock surged 2.9 percent to $620 in premarket trading on the New York Stock Exchange after the business stated it wanted to make its stock more “accessible” to investors.
Shopify was formerly the most valuable Canadian company by market value, trading at approximately $1,600 in November. The company, however, lost that distinction after its shares fell by more than half this year.
Its action follows the announcements of share splits by e-commerce behemoth Amazon.com Inc (AMZN.O), Google parent Alphabet Inc (GOOGL.O), and video game retailer and “meme” stock GameStop Corp (GME.N) this year. Meanwhile, Tesla Inc (TSLA.O) said that it will seek shareholder permission for a stock split.
On Monday, Shopify announced that for each share owned as of June 22, each stakeholder will get nine more shares on June 28.
The company’s class A shares currently have one vote per share, whereas class B shares have ten votes per share.
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