Groupon IPO Raises $700 Million, Priced At $20 A Share

Biggest internet IPO since Google

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Groupon IPO Raises $700 Million, Priced At $20 A Share
[ Business]

Daily deals powerhouse Groupon has priced its Initial Public Offering at $20 a share, a move that will raise $700 million for the barely 3-year-old startup.

This IPO values the company at around $12.8 billion.

The oversubscribed company added five million shares to its offering, upping the figure from 30 million shares sold to 35 million shares sold. This still only amounts to 5.5% of the company.

The $20 a share pricing is slightly higher than what was expected. The price range that was originally discussed was between $16 and $18 a share.

It looks like most of the trepidation surrounding Groupon’s IPO went by the wayside as people rushed to buy a piece of the company. On the bumpy road to an IPO, Groupon had been hit with executive troubles, and criticism of accounting practices.

This IPO is the second largest by an internet-based company – all time. Of course, the biggest IPO crown belongs to Google in 2004. Groupon will begin trading Friday under the symbol “GRPN.”

Here’s some of the chatter surrounding the huge IPO:

People have A LOT of faith in Groupon as a sustainable company, but I still don’t see it. $700 million IPO pretty much speaks for itself 13 minutes ago via RockMelt · powered by @socialditto

I am confident in the wisdom of markets (eventually) — re: Groupon IPO Day Today 16 minutes ago via Ping.fm · powered by @socialditto

#Groupon IPO today… checking for IPO coupons, maybe at 50% off I’ll buy.. Going to pass on this one. Love the company though. 17 minutes ago via web · powered by @socialditto

Rocky Agrawal at VentureBeat says that he still believes that Groupon is a “terrible company for investors, small businesses and ultimately for consumers.” But he’s buying shares –

All of that said, I’ve put in my request with my broker for shares in the IPO because Groupon has scientifically engineered its IPO to inflate share prices. Its float is one of the tiniest in the last decade. Most likely this thing will have a nice pop.

What do you think of Groupon’s IPO? Let us know in the comments.

Groupon IPO Raises $700 Million, Priced At $20 A Share
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  • http://www.PlacesToEatOkay.com Steven

    The failure of Groupon will be that not many types of business have high enough margins to offer a discount and then pay Groupon their share of the gross revenue on top of that that Groupon expects. I see most businesses trying this once and feeling sorry because it really didn’t make them any money, or not much at all, and so many might end up raising their prices just to accommodate the Groupon offer and make it look like you’re getting the deal you’re paying for. Already many Groupon advertisers have been caught trying to claim a discount is what it is, and then you find out their normal price is lower than what they say it is on Groupon or that they’ve raised their prices just to accommodate the discount and the money they have to pay to Groupon. How does Groupon insure this doesn’t happen?

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