Google acquires Groupon for $2.5B? Google May Acquire Groupon for $6 Billion, and It Would Be Worth Every Penny. Forget the rumor that Google acquired Groupon for $2.5 billion; the search giant is about to close a deal for the group-buying service for a whopping $5.3 billion to $6 billion, according to multiple reports. It would be worth every penny. The deal is worth $5.3 billion with an additional $700 million earnout based on performance, according to All Things D. The New York Times reports that a deal could be completed as soon as this week. With a price tag almost double that of DoubleClick, Google's biggest acquisition to date, there are still plenty of ways for this deal to fall apart. Earlier this year, Yahoo tried to snag the group-buying company, but failed. Google, with its $30+ billion cash reserve, reportedly then offered Groupon $3 billion to $4 billion.
However, it was rebuffed, so the tech giant upped its offer. Groupon pioneered the group-buying model through its deal-of-the-day business model. It's that attention and expertise Google wants. Image courtesy of iStockphoto, Pagadesign. Google Buying Groupon Doesn't Make Sense. Posted by Tom Foremski - November 30, 2010 UPDATED: Faith Merino at VatorNews reported Monday that Google has purchased Groupon for $2.5 billion: " ... according to an unnamed insider who spoke with VatorNews. Neither Google nor Groupon could be reached for comment to confirm the report, but Vator's source is reliable and the report falls in line with the recent string of Groupon acquisition rumors. Tuesday Kara Swisher at All Things D reported that her sources said that Google will pay $5.3 billion plus a $700 million earnout if Groupon meets sales targets. ... it is a killer move for Google-despite the high price-given it has long tried to enter the local advertising space, with decidedly mixed results.
The New York Times reported that its sources said Google will pay $6 billion for Groupon. Google made an initial bid of $3 billion to $4 billion, these people said. Foremski's Take: The deal doesn't make sense for Google. Caroline McCarthy at CNet News makes a similar point: Google Raises Concerns. Google’s $6 billion bid for Groupon, an online coupon start-up, is an aggressive move by the company to dominate local online advertising and help with its long-sought move into social networking. Google has offered Groupon $5.3 billion, with the promise of $700 million in performance bonuses for management, according to a person knowledgeable about the matter who spoke on the condition of anonymity. Several people close to the deal said Groupon, which is based in Chicago, was expected to approve the acquisition and an agreement could be signed as early as this week. Jose More/Chicago News CooperativeGroupon’s headquarters in the former Montgomery Wards catalog warehouse in Chicago.
Noah Berger/Bloomberg NewsAndrew Mason, the founder and chief executive of Groupon. If the deal is completed, Groupon will stand as Google’s largest acquisition, easily topping the company’s $3.1 billion purchase of DoubleClick in 2007. Mr. Not all small businesses are sold on the golden promise of Groupon. No deal.