Groupon value could be $15 billion in IPO

Jan. 14, 2011 at 2:27 PM
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NEW YORK, Jan. 14 (UPI) -- Groupon, the deal-of-the-day Web site that turned aside a $6 billion offer from U.S. search giant Google, said it is proceeding with an initial public offering.

Two people with knowledge of the deal said the company, which just raised $950 million from big investors, discussed a public offering with bankers this week, a move that could value Groupon at $15 billion or more, The New York Times reported Friday.

If it happens, a public offering would be a huge milestone for the startup and its founder Andrew Mason, analysts said. The offering, which would be among the most anticipated since Google's IPO in 2004, would represent the highest valuation on the company to date.

Groupon earlier this week raised nearly $1 billion from large investors, including Fidelity Investments, T. Rowe Price and Morgan Stanley. Given Morgan Stanley's recent stake, some analysts think Morgan Stanley is on the short list competing to take Groupon public.

"Morgan Stanley is one of the premier firms on Wall Street. An investment would give them an inside track on an IPO," Greg Sterling, an analyst and the founder of Sterling Market Intelligence, told the Times.

Analysts said Groupon may be moving quickly to take advantage of the market's momentum, glomming on to excitement surrounding fast-growing Web companies.

"It's smart to strike while the iron is hot, and they're the most visible and fastest-growing player in their market," Sterling said. "To wait a year would inject a level of uncertainty for the proposition of going public."

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