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Report: Groupon is Actively Seeking a Buyer

By NexChange
Capital Markets

Groupon’s decade-long roller coaster ride that has taken it from a highly buzzed startup to a middling company struggling to recapture that early momentum could be ending with an acquisition, Recode reports.

Recode‘s sources tell the news site that Groupon executives and bankers representing the Chicago-based company “have contacted several public companies,” becoming “especially aggressive last month in attempting to create interest among potential suitors.”

Groupon’s efforts to find another company that will buy it out – and thus ending its run as an independent business – makes sense: Groupon’s overall revenue fell 5.6 percent last year to $2.84 billion, its lowest since 2013, according to Recode. More troubling for the company is that its very business model has fallen out of favor with consumers since its IPO several years ago.

Per Recode:

In the first few years following its launch in 2008, Groupon was one of the darlings of the startup world after introducing the concept of daily deals to online consumers, igniting a frenzy among deal seekers and local businesses alike. By its IPO day in 2011 — the second-largest ever for a tech company at the time — Groupon was worth more than $16 billion, making its decision to turn down a $6 billion acquisition offer from Google a year earlier look smart.

But that may have been the company’s peak. Today, Groupon is valued at just $2.4 billion after a years-long decline in the daily deals category; Groupon acquired its principal competitor LivingSocial for $0 in 2016. Amazon once owned a third of LivingSocial in addition to operating its own local deals business, which it shut down in 2015.

Groupon’s stock was trading at $4.83 on Tuesday afternoon in New York.

Photo: Groupon

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