E-commerce company Shopify (SHOP) has announced a 10-for-1 stock split along with
changes to its governance structure.
Ottawa-based Shopify, which helps small businesses run websites and conduct online sales,
said it will create a new class of shares to ensure its founder and chief executive officer (CEO)
Tobi Lütke can retain control over the company.
Shopify announced it is creating a new “founder share” that will ensure Lütke controls 40% of
Shopify’s total voting power. The arrangement also requires Lütke to retain a stake equivalent to
at least 30% of the company’s Class B shares, each of which carries 10 votes.
Shopify also announced that its board of directors has proposed at 10-for-1 stock split. Other
technology companies have also announced stock splits this year, including Amazon (AMZN)
and Alphabet (GOOGL).
Shopify’s shares have plummeted 50% year to date after soaring 367% from mid-March 2020 to
their peak last November. The company’s shares finished trading in Toronto yesterday (April 11)
at $780.02 per share.
The proposed stock split and governance change are each subject to shareholder approval at
Shopify’s annual meeting to be held on June 7.
