Google plans to restructure into a new holding company called Alphabet

Technology giant Google announced Monday a change in its corporate structure to improve management and put its products and R&D divisions under the umbrella of a new parent company, Alphabet.

“Our company is operating well today, but we think we can make it cleaner and more accountable. So we are creating a new company, called Alphabet,” Google CEO Larry Page wrote on the company’s blog.

With Page as CEO and Google cofounder Sergey Brin as president, Alphabet will encompass Google, the main division of the new conglomerate with a $60 billion annual turnover.

As part of the restructuring Google Product Manager, Sundar Pichai, will step into Larry’s shoes as CEO of Google and Google Chairman Eric Schmidt will become the executive chairman of Alphabet.

The idea behind Alphabet is to place the more independent divisions of Google such as Google Ventures, Google Capital, Google X within a structure.

With these changes, Page and Brin take on more strategic roles in the company.

The U.S. Securities and Exchange Commission, or SEC, has been notified of the reorganization.

“Google will become a wholly owned subsidiary of Alphabet. Our two classes of shares will continue to trade on Nasdaq as GOOGL and GOOG,” explained Page.

Google stock climbed 5.41 percent to 699 in afterhours trading post the announcement.