Shopify Inc. today announced a 10-for-1 split of its class A and class B shares, subject to shareholder approval.
The company now joins a growing list of businesses that have split their shares to make them more appealing to investors.
At its upcoming Annual and Special Meeting of shareholders on June 7, the eCommerce giant said it plans to seek shareholder approval for the 10-for-1 stock split of its common stock. In a statement, it noted that the proposed split will make ownership more accessible to investors.
Other major companies to announce split proposals include Alphabet Inc., Amazon.com Inc. and Tesla Inc.
Shopify also announced it will give chief executive officer Tobi Lutke a special “Founder share” that will preserve his voting power as long as he’s at the company. The proposal aims to maintain Lutke’s voting power. The Founder share will provide him with a variable number of votes, and that, combined with his previously owned shares from other classes, would represent 40 per cent of the total voting power attached to all of Shopify’s outstanding shares.
At the moment, the company’s class A shares carry one vote per share and class B shares carry 10 votes per share.
Today U.S.-listed shares of Shopify decreased slightly at $602.61 in morning trading, while they were slightly up at C$765 on the Toronto Stock Exchange. They have lost more than half their value this year.
A stock split could potentially boost retail share ownership, as the cheaper stock price is more accessible to a wider range of investors.