Google Groupon Deal: It has been well documented that Groupon Inc (NASDAQ:GRPN) stock is not exactly performing as original post-IPO investors had planned. Saying that the company is struggling is an understatement. Does this mean that Groupon may be looking for a way out, possibly by way of an acquisition?
If you are to believe recent rumors, the answer to these questions is “yes.” According to multiple outlets, Google Inc (NASDAQ:GOOG) may be interested in making a play for the company.
Last Friday, Groupon stock increased 23% on a Bloomberg report that Google is considering making a bid for the well-known daily-deals site.
While this may be news to some, Google has had its eyes on Groupon for a couple of years. In the closing months of 2010, the search engine giant offered to purchase Groupon for $6 billion.
Rather than accept, Groupon decided to go public. Looking back, it appears that the company known for leading the daily-deals space made a poor decision. Over the past year, shares have plunged by roughly 80%.
Thus, there are two questions that need answered:
1) Would Groupon be interested in selling out, rather than attempting a turnaround?
2) Is Google Inc (NASDAQ:GOOG) truly interested in making a bid for the company, despite the fact that its growth rate by quarterly revenue has declined from 185.6% to 32.2% in the past year?
One thing that may scare Google away is Amazon.com, Inc. (NASDAQ:AMZN)‘s blunder with its investment in LivingSocial (another popular daily-deals service).
Let’s take a look at things from a different perspective.
Maybe Google is not interested in getting involved in the daily-deals industry. Instead, they may see this as a way to dig deeper into the local e-commerce space. At this point, there is a lot of speculation regarding a deal but nothing concrete in the works.
With this in mind, investors have backed off and Groupon stock is down approximately 7% in Monday trading. As long as Groupon continues to struggle, acquisition rumors, especially those regarding Google Inc (NASDAQ:GOOG), will remain at the forefront.
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