Google plans to raise $2.1 billion in stock offering

Even after amassing $8 billion in cash by the end of 2005, Google Inc. is looking for more, announcing on Wednesday that it plans to issue to issue an additional 5.3 million shares of stock.

The new shares would bring in $2.1 billion based on the value of Google's stock at close of trading on Wednesday.

The sale is intended in part to meet the needs of index funds to purchase Google stock once Google is added to the S&P 500 Index, Google said. Google will be added to the S&P 500 Index at the close of trading on Friday.

Google will use the money raised for working capital, expenses and possible acquisitions of complementary businesses, technologies or other assets, it said.

Since going public in 2004, Google has grown flush with cash. The initial public offering raised $1.7 billion. It was followed by an offering in September last year of more than 14 million shares that raised an additional $4 billion.

Google has used some of the cash to make a handful of acquisitions over the past year. In early March, Google purchased online word processing applicator developer Writerly. Earlier this year, Google bought dMarc Broadcasting Inc., a developer of a radio advertising platform, for $100 million plus additional future payments that could reach $1 billion. Google also recently purchase 3D design company SketchUp and also invested $1 billion in America Online Inc. late last year.

Google continues to lead the search market. Google handled 41 percent of searches in the U.S. in January, up six percentage points, according to recent research offered by ComScore Networks Inc. Yahoo took the number two spot with almost 29 percent of searches and MSN came in third with almost 14 percent, based on the ComScore report.