Google’s parent company Alphabet Inc. (NASDAQ:$GOOGL) announced Friday that it is in fact forming a new company called XXVI Holdings Inc. The purpose? To finalize the search giant’s transformation into a corporate conglomerate with units across a range of sectors and industries.
Essentially, XXVI will allow Alphabet’s business units that are now under the Google umbrella—called “Other Bets”—to become subsidiaries of Alphabet. Alphabet will now be corporate parents with distinct arms that protect individual businesses in far-flung fields, like health care, to self-driving cars, to consumer retail.
XXVI means 26 in roman numerals, which is also the number of letters in an alphabet. The company will own the equity of each Alphabet company, including Google. The move may have resulted from Alphabet’s edged-down stock during the regular session to $952, but is up 20% in total this year.
Google is also shifting from a corporation to a limited liability company, or LLC. This comes as a result of Google’s transformation from a listed public company into a business owned by a holding company. As litigator of Buchalter law firm Dana Hobart explains: “By separating them, it allows the parent company to limit the exposure of the various obligations of the LLCs.”
The new structures were disclosed in a filing on Friday with the Federal Communications Commission. The final result? Alphabet and Google will be able to operate in a more efficient, economical, and transparent manner. The saved time will allow the companies to concentrate on their revenue generating activities.
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