Google’s Biggest Acquisition Ever: Offers $5.3 Billion to Groupon


Just yesterday I learned about Google’s confidence in cloud computing when company has revealed its plan to launch much anticipated Chrome OS in coming December. Apparently, company is in no mood to slow down or discount its efforts in order to stay supreme in cloud computing and has offered $5.3 Billion to Groupon – A leader in online E-Commerce and E-Coupons industry – in order to dominate E-commerce business and to add another proven revenue generation model to the business, as reported by NYT.

As we had reported earlier about possible Google’s acquisition of Groupon last week, we had sensed the success of such attempt and had presented the profit & loss analysis for Google at that time. As per the sources, deal be signed by both the companies as early as sometime this week.

However, the possibility of failing the deal is also surrounding the acquisition efforts. Due to its strong revenue generation model and enormous success in just 2 years, Groupon has firm support from all its investors. Company will test the latest offer against the feasibility of new round of funding for sure.

But if this deal bypasses all obstacles and reaches to destiny, Google will not only get benefit from the finance stand posit but will also be having the access to huge data which talks about consumers shopping habits globally. Trust, this will be the second major achievement which Google may be eyeing besides revenue from this deal, as company knows the best how to capitalize such vital information.

Combined with its pending $700 million acquisition of ITA Software, the travel data firm; which should freak out regulators worldwide and could be considered Google’s own version of a jobs plan for antitrust lawyers. Undoubtedly, it’s a killer move by Google which will benefit the company in multiple ways.

Equally, it’s a big achievement for Groupon, a social shopping & daily deal company, which was founded just 2 years back. Compare to other acquisition Google made till day – be it Youtube, Picasa, AdMob, Feedburner and many others – Groupon acquisition is not only the biggest in recent times but also a good payout for a startup when hundreds of clone are cropping up in almost every country to kill its future growth. Currently Groupn is holding a revenue figure of 350 million with 12 million registered users majority in U.S. and Europe. Till date Google has made more than 83 successful acquisitions across the globe.

Initially, it was Yahoo who attempted to acquire the Groupon by offering $2 – $3 Billion. Unfortunately Groupon didn’t find its much lucrative to bind with it. Following to which, Google initiated the dialog with Groupon on the same line by raising the offer to $3 billion to $4 billion, as per the sources. In the presence of Groupon’s resistance Google has raised its offer which stands aprox $5.3 Billion which is unlikely to grow.

With lots of speculations and predictions, deal is not far from closing. Interesting thing is to monitor the real negotiation capabilities of Groupon management with Google when they all will sit across the table to sign. If Groupon is known for its best negotiation capabilities, Google is the among very few companies who can afford to pay such huge price. I am sure Groupon, which offers daily deal at with huge discount, will not allow the biggest ever deal to go out from their kitty.

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