Google Talks with Groupon May Have Ended Without Any Deal

By Ed Silverstein December 07, 2010

It takes confidence to back away from a deal valued at $6 billion. But that’s what Groupon, a two-year-old company, reportedly did after Google made the historic offer to acquire the company, which specializes in local business advertising.

The two sides simply broke off their discussions last week, The Wall Street Journal reported, citing an unnamed source. Sources told The Journal that the members of Groupon’s board were of divided opinions about the offer from Google.

All Things Digital reported that Google offered $5.3 billion for Groupon, with a further $700 million to be paid if Groupon's was able to reach certain milestones, said The Journal. Google’s rivals, such as Facebook  and Yahoo, are interested in the sector, too. Yahoo had earlier tried to acquire Groupon.

Groupon uses more than 1,500 sales and customer service employees to call local businesses.

Andrew Mason, Groupon’s 30-year-old founder and CEO, was reportedly concerned with the strategic direction of the company under Google, according to a report in Atlantic Wire. It would have been Google’s priciest acquisition ever.

The company may try to launch an IPO (Initial Public Offering), The Journal reported. Still, there is speculation that Google could increase its bid for Groupon, according to a report carried in Business Insider. The report also speculates that Google and others are very interested in a forthcoming Groupon feature called Groupon Stores.

With Groupon Stores “businesses can create and launch their own deals whenever they want,” according to Groupon Blog.  It works much like a retail store’s actual storefront, the blog said.

Groupon Stores are being tested in Chicago, Dallas, and Seattle, according to Business Insider.

“Each day we’ll select the best deals from Groupon Stores and match them to customers using our personalization technology. Follow any Store so you’ll never miss a deal from your favorite merchant,” explained the Groupon blog.

Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.

Edited by Jaclyn Allard

TechZone360 Contributor

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