Shopping deal webiste Groupon has rejected a $6bn bid from Google, saying it is planning a possible public offering instead.
The sale was expected to fetch up to $6 billion in a deal which had set tongues wagging on Wall Street about whether such a valuation represented good value for Google.
However Groupon had been playing hard to get, spurning offers from previous firms such as Yahoo and walking away from a deal with Google in favour of a possible public offering in 2011.
Groupon, a privately held, Chicago-based company which was launched about two years ago sends its members daily emails with about 200 deals for goods and services. The deals are activated only when a minimum number of people agree to make a purchase, giving Groupon clout to negotiate steep group discounts on products and services.
The acquisition would also have been Google’s first major move into local business online advertising, a large and untapped market it has been trying to get into.
Google recently promoted its executive Marissa Mayer to oversee the local business and attempting to buy Yelp, the local review site, last year.
Since its founding in 2008 by Andrew Mason, Groupon has been growing at a nearly unprecedented pace.
Since its launch, Groupon has signed up more than 12 million registered users and reaping more than $350 million in estimated annual revenue.
The company, whose name is a combination of “group” and “coupon,” specialises in providing customers with discounts purchased in bulk. Subscribers receive notifications of one deal a day, tailored to their location and profile.
The average Groupon deal offers between 50 percent to 90 percent off retail goods and services, from restaurant certificates to sky diving lessons. It has grown beyond local merchants to encompass national retailers like the Gap, which offered a nationwide deal this summer.
On the day of the Gap promotion, Groupon sold 440,000 units and generated $11 million in revenue.
Over recent weeks, Groupon has been the subject of scores of takeover rumors. Both Google and Yahoo were among the company’s top suitors, according to the people briefed on the matter, with the latter prepared to pay about $2 billion. But Groupon’s founders rejected the approach as too low.
