Groupon to Acquire LivingSocial
Groupon announced yesterday that it will acquire one-time rival LivingSocial. The Chicago-based e-commerce marketplace didn't disclose the price it paid for a shrunken LivingSocial, but said, "the acquisition consideration is not material." Groupon expects the deal to close in November. LivingSocial said last month it was laying off half its employees, bringing its headcount to about 200. At its peak, it employed more than 4,000.
Total Retail’s Take: After Groupon announced its acquisition of LivingSocial, the company’s stock dropped about 10 percent. This isn’t the first time LivingSocial has had negative effects on a company. In 2010, Amazon.com invested $175 million in the e-commerce marketplace, only to report a $169 million loss two year later. Groupon has faith that LivingSocial will bring an extra 1 million customers and $15 million in revenue per quarter.