Alphabet Chief Legal Officer Sale of $145M in Stock Before CEO's Exit Fits Pattern
"It doesn't seem like he's unloading or trying to get out," said insider trading analyst Jasper Hellweg of Argus Research in New York.
December 13, 2019 at 01:40 PM
3 minute read
The timing of Alphabet Inc. chief legal officer David Drummond's sale of $145 million in stock ahead of the company's CEO stepping down might seem curious. But his actions appear to be routine and should not alarm investors, according to an insider trading analyst.
"He's received [stock] options in the past and has done the exact same behavior," said Jasper Hellweg of Argus Research in New York. "If it was structured differently it would catch my eye differently. But these are options. It's part of his compensation. It doesn't seem like he's unloading or trying to get out."
Hellweg noted that Drummond's insider transactions filings with the Securities and Exchange Commission show that he has routinely received stock options and automatically sold the same shares of stock.
Drummond followed that pattern of behavior in early November and Dec. 2, when he sold $72 million and $73 million of stock, respectively. The transactions stood out primarily because they were larger than his previous stock sales—and Alphabet CEO Larry Page stepped down Dec. 3.
"It wouldn't be anything that I would flag if I were in an investor position," Hellweg said. "These just happen to be larger options. He hasn't received options of this size before. But he's still going by his same behavior."
Alphabet is the parent company of Google, which did not respond to a request for comment.
Drummond made more than $47 million last year. His compensation has been a controversial issue since he was accused of sexual misconduct while serving as the general counsel of Google in New York.
He has acknowledged that he had an affair in the mid-2000s with Jennifer Blakely, a senior contracts manager in the legal department. Blakely said she was forced out of her job after she became pregnant with Drummond's child and management found out about the affair.
After Blakely spoke out earlier this year, Drummond said in a written statement, "Jennifer and I had a difficult break-up 10 years ago. I am far from perfect and I regret that."
He asserted that he "never started a relationship with anyone else who was working at Google or Alphabet. Any suggestion otherwise is simply untrue."
Drummond added that he realized Blakely "feels wronged and understand that she wants to speak out about it. But I won't be getting into public back and forth about these personal matters."
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