Zuckerberg Will Sell Shares To Fund Philanthropy

Mark Zuckerberg, the chairman of Facebook Inc., has abandoned his plans to create a new class of company stock or class C no voting stock to fund the Chan Zuckerberg Initiative. The company’s profits over the past year have increased to a level that allows the founder to fund his philanthropic foundation and retain voting control without issuing a new nonvoting class of stock.

Zuckerberg announced his plans to issue nonvoting shares in April last year to keep founder control of Facebook and “resist the short term pressures that often hurt companies.” His decision was met with harsh criticism and a lawsuit was filed by Sjunde AP-Fonden, a Swedish national pension fund and The Amalgamated Bank. The lawsuit claimed Zuckerberg should have to pay for the right to retain control while selling stock and his decision could dilute the decision making powers of the other investors.

In a Facebook post earlier today, Zuckerberg announced Facebook’s business has performed well, allowing him and his wife Priscilla to continue their pledge to give away 99% of their shares to charity. According to the post, even smaller allotments of his stake in the company can deliver plenty of capital to the Chan Zuckerberg Initiative (CZI.) The philanthropy aims to help eradicate disease and deliver personalized education to all children. Emphasizing his decision to give away the majority of his shares, Zuckerberg added that over the next 18 months he planned to sell 35 million to 75 million shares of Facebook. According to current market price, 35 to 75 million shares of Facebook could raise close to $13 billion for the charity.

Currently, the founder and CEO owns more than 400 million shares of Facebook which amounts to a minimum of $ 68.2 billion. Zuckerberg will have the power to shape Facebook’s decisions for the foreseeable future and continue to make bold or counter intuitive decisions without shareholder interference for the next 20 years.

Read the complete Facebook post here.