Good morning. It’s “Cyber Monday” and the Google-is-buying-Groupon rumors are circulating again. In fact there is a rumor that Google has already agreed to acquire the daily deals purveyor.
The general rumor of Google’s interest in the group buying leader been going for at least couple of weeks now. It follows similar rumors about Yahoo wanting to buy Groupon for a huge amount. The rumors probably validate that Google and Groupon are talking.
If Google were successful it would probably be cash + stock deal like AdMob. But the price would potentially be much more than AdMob and north of $2 billion, given Groupon’s current valuation. In fact at $2 billion or so, if it happens, it would become Google’s second largest acquisition after DoubleClick.
I’ve argued in the past that Yahoo shouldn’t buy Groupon because it is too expensive for what it delivered. But Google’s got cash to burn. What’s a couple billion, right?
Recall that Google effectively has no meaningful coupons/deals play, although the company is thinking very hard about the segment. Recall also how focused now Google is on local. So conceptually it makes sense. Google tried unsuccessfully to buy Yelp, which would have given the company a local brand and sales channel. Essentially the same is true here. Google would own a local sales force, as well as the Groupon brand and its global-local reach. Google could easily further establish the Groupon brand with some additional visibility and promotion. Think about the combination of Google Places and Groupon promotions.
It would also own a huge consumer email list as well. It sure would be an interesting deal if true.
There would also be no anti-trust issue here that I can see given how competitive the segment is and the fact that it relies very little on search. Let’s see if the rumors are real.