Groupon, Inc. Currently Has a Value of $1.62 Billion
Remember Groupon, Inc., that daily coupon site that was so popular just a few short years ago?
As of the close of trading today (Monday, November 16th), one share of Groupon, Inc. (GRPN on the NASDAQ stock exchange) would have set you back $2.64. This gives the company a valuation of $1.62 billion.
Back in the fall of 2010, search engine giant Google came calling with an offer for Groupon - $6 billion ($5.3 billion plus a $700 million earnout). The deal would have cashed out the founders and investors in the company, all at a tidy profit. At the time, Groupon was growing rapidly and was discussing going public.
Now, there were some issues with the deal - namely, whether or not antitrust regulators would allow it to go through. Google offered Groupon a $800 million breakup fee if this took place, but Groupon's insiders were still nervous.
The biggest block to accepting the deal, however, was Groupon's potential. Sure, $6 billion was an enormous amount of money, but companies like Netflix and Facebook were both worth the same amount of money at one point as well, and both companies turned down billion dollar offers en route to creating tens of billions of dollars (hundreds of billions of dollars in the case of Facebook) more in value for their investors. Groupon felt that the business still had a great deal more to grow, plus they felt as though they could leverage their own data to make even more money.
At the end of the day, Groupon did the unthinkable - they turned down Google's billions. Instead, company insiders elected to take Groupon public.
Groupon's business is falling apart, as evidenced by the steep decline in their shares over the past couple of years. Their most recent earnings report was met with even more selling, and it seems unlikely that the company will be able to turn things around at this point. Groupon, which was once a hot commodity and used by many millions of people, has now been largely forgotten.
Groupon's founders and investors will now be left to wonder - what if we had sold to Google in 2010?
Filed under: General Market News