Groupon seeks to raise $950 million in private funds
Groupon, the online coupon company that rejected a $6 billion takeover bid by Google earlier this month, is doing some expansion of its own. The website is looking to raise $950 million of its own money, pushing the privately owned company to a worth of around $6.4 billion, VCExperts.com reports.
The company recently filed paperwork with the state of Delaware to authorize the selling of more than 30 million shares of stock. The company spokesperson has declined to comment, and while there was speculation that the fundraising was an attempt to make an initial public offering (IPO), but the CEO Andrew Mason quelled any such rumors. However, a vague post on Twitter left much to the imagination.
"Groupon is in the process of completing a new round of financing – we'll let everyone know when there's more to announce," he wrote.
Some experts say that the cause for the increase in funds has to do with the fact that there are a number of competitors quickly encroaching on Groupon.
"Groupon is probably looking to get out and build a moat around their operations as soon as possible," Peter Falvey, co-head of tech banking for Morgan Keegan, told the news source. "That's going to be expensive."
Others believe that the expansion, the largest since Pixar wanted to raise around $500 million in 1995, is an effort by the company to grow their operation in other countries. Currently, Groupon has a presence in 35 nations across the globe, and employs more than 3,000 people, according to the Los Angeles Times.
Groupon is little over two years old, and since its launch in November 2008, has grown very rapidly. As of November 2010, the website, which offers daily coupons and turns a profit by taking 50 percent of each discount it sells, has more than 35 million subscribers. The company is expected to take in around $500 million dollars in 2010 alone.