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Source link: http://blog.mises.org/1931/forced-public/

Forced Public?

April 30, 2004 by

Why did Google go public? “They have no choice,” says the Christian Science Monitor. “A 1934 law requires that any private company that reaches a certain size must provide its operation figures and finances to the federal government. Google passed that threshold last year and needed to comply by Thursday, according to reports. An initial public offering (IPO) of stock is expected to follow.” [Thanks Kent Snyder]

{ 3 comments }

Jule Herbert April 30, 2004 at 4:56 pm

Koch Industries, Cargill, Bechtel, the New York Stock Exchange itself, are examples that suggest the the Monitor overstates the 1934 statute impact.

Tim Swanson April 30, 2004 at 7:53 pm

Be sure to look at Google’s S-1 sometime: here. Of particular insterest is the letter from the founders (as it outlines how their counterculture mentality): here

Bill Lloyd May 1, 2004 at 8:59 am

The “1934 act” meant is I suspect actually the provision within the Securities Exchange Act [of 1934] which merely requires already “publicly-held” firms with assets in excess of a certain amount to file financial reports [thus made available to the public] with the SEC. I use “publicly-held” loosely; the provision itself specifies the threshold number of stockholders [last I looked, but that was some time ago, the number was 500]. Thus the article [Christian Science Monitor? -- what HAS happened to journalism???] is entirely misleading: ONLY if Google’s stock were held by at least the specified number of shareholders would the provision apply, and even then the provision has nothing to do with in any way requiring any firm to do an IPO.

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