Google going short on Google

Google Inc. said Thursday it plans to offer another 14.2 million shares, currently worth about $4 billion.

Google is selling lots more shares. Why? It does not appear they need the money. So the obvious answer is that they think their stock is priced to high. So they will float more shares now, and then in the future they will do a stock buyback and purchase them back at a lower price. Or another way of saying this is that they are going short on their stock. And at near $300, who can blame them?

You could argue that the need the cash for acquisitions, but really who wouldn't want Google stock over cash?

Or you could buy into the sexy rumor that Google is becoming an infrastructure company and needs the cash for that. Engadget blogs:

Business 2.0 reports that they’ve learned from “telecom insiders” that Google is hard at work on a nation-wide high-capacity data network, buying up unused fiber lines and cheap backbone access to really flesh out their capacity. B2 theorizes this could result in a massive digital video db, on-demand television (IPTV) system, or free ad-based WiFi network, which in conjunction with location-tracking hotspot firm Feeva, has already been pilot launched in San Francisco serving up Google Local-based ads.

And as cool as that sounds, I just don't see it happening. Running a search/internet portal company and running a telco are two different ballgames.

Via Yahoo! News