9:46 AM
Groupon raises $500 million, to payout investors
Addison Ray
BOSTON | Thu Dec 30, 2010 11:44am EST
BOSTON (Reuters) - Groupon, considered one of the fastest growing companies in Internet history, has raised $500 million as part of an effort to generate $950 million in financing.
The 3-year-old online discount coupon company raised the funds, according to a regulatory filing on Thursday, after reports last month that it was in talks to sell itself to Google Inc for up to $6 billion.
Had the talks been successful, it would have been Google's biggest acquisition.
Groupon did not disclose the names of the investors. Company executives could not be reached for a comment.
The bulk of the funds raised -- $344.5 million -- will be used to buy back stock from existing shareholders, the company said in a filing with the U.S. Securities and Exchange Commission.
Its shareholders include Chief Executive Andrew Mason and Digital Sky Technologies, which also is an investor in Facebook.
"That is a nice little chunk of change," said Justin Byers, head of business intelligence for VC Experts, a firm that follows investments in private companies.
Analysts estimate it has annual revenue ranging from $500 million to $2 billion. It sends members daily e-mails with discounts from local merchants. The discounts are activated when a certain number of people agree to make a purchase.
(Reporting by Jim Finkle; Editing by Derek Caney)
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