Schmidt to get $100 million golden handshake

Google is set to give Eric Schmidt a $100 million equity award as he hands over the chief executive officer job to co-founder Larry Page.

The award, which will include stock units and options, will vest over four years and is Schmidt’s first such award since joining the company in 2001. However, it’s a small drop in the ocean compared to Schmidt’s $5.6 billion share of the company.

In a surprise announcement last week, Google said Schmidt will take on the role of executive chairman in April and will be replaced as CEO by Google co-founder Larry Page. The news came on the same day that Google reported earnings and revenue that blew past expectations.

While Google has dominated internet search, it has struggled with social networking and is facing stiff competition from companies such as Facebook and Twitter, which are stealing Web traffic and engineering talent.

Schmidt said in an interview with Reuters that his move wasn’t a reaction to competitors but an effort to speed up decision-making at the internet giant.

In a regulatory filing last week, Google said that Schmidt in December drew up a plan to sell some of his stock in the company. “The pre-arranged trading plan was adopted in order to allow Eric to sell a portion of his Google stock as part of his long-term strategy for individual asset diversification and liquidity,” the filing said.

As of 31 December, Schmidt had about 9.2 million shares in Google – a holding worth in excess of $5.6 billion at today’s stock price – and controlled 9.6% of the company’s voting power.

Schmidt plans to sell about 534,000 shares of Class A common stock – meaning he would continue to hold 8.7 million shares of Google stock and control 9.1% of the company’s voting power.