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Groupon stock up over new Google rumor

Groupheadquarters Chicago.

Groupon headquarters in Chicago.

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Updated: February 28, 2013 1:01AM



Will Chicago become home to a mashup of Google and Groupon after all?

Groupon’s stock skyrocketed 23 percent Friday, up 88 cents to $4.69 a share, after an analyst speculated that Internet search giant Google could once again try to take over the beleaguered Chicago-based daily deals site.

Neither Groupon nor Google would comment.

It was Groupon’s highest closing stock price since Oct. 19. The stock is 76.5 percent below its initial public offering price and Groupon’s market value about half of Google’s initial $6 billion takeover offer. Groupon rejected the offer in December 2010.

A Telsey Advisory Group spokesman confirmed Friday a Bloomberg News report that Telsey analyst Tom Forte speculated that Google might be interested in acquiring Groupon now that Groupon is worth roughly half Google’s first offer.

“Where the stock is currently trading, it’s a takeout candidate,” Forte said in the report.

Another analyst disagreed.

Edward Woo, senior research analyst at Ascendiant Capital Markets, said he believes Groupon “has too many issues going on for somebody to want to acquire right now (at what would still be a large amount of money at $3 billion).”

Woo said the stock is probably just recovering from declines that followed Groupon’s board’s decision to keep Andrew Mason as CEO — at least for now.

Groupon’s stock price jumped on Nov. 28 as investors looked to the daily deal site’s board of directors to either replace Mason as chief executive officer or give him at least six months to turn around the company’s reputation and disappointing financial results. The stock dropped after the board said on Nov. 29 that Mason remained CEO.

Experts say Groupon can no longer rely on daily deals as a growth engine, with so many deals available and consumers’ weariness of them. Aside from making its accounting process more open, Groupon needs to find profitability in a fast-growing product such as a mobile offering that doesn’t require loads of inventory and convince people to do more business with local merchants, the experts say.

On a separate issue, Google is reported to be accepting bids for the TV set-top-box business it acquired when it bought Libertyville-based Motorola Mobility for $12.5 billion in May.

The Wall Street Journal reported Friday that bidders for the set-top box business could make offers ranging from $1.5 billion to $2.5 billion. Likely bidders include private-equity companies and other hardware manufacturers, the report said.

Mobility split from the old Motorola in January 2011 and took $100 million in a 10-year state tax incentive deal to keep its headquarters in Libertyville. The plans changed after Google’s acquisition. On July 26, Motorola Mobility announced it would move its Libertyville headquarters — and 3,000 workers — to downtown Chicago, taking the top four floors and rooftop of the Merchandise Mart and becoming the landmark building’s largest tenant with 600,000 square feet. The space is being prepared now for a spring 2013 move-in of well-paid engineers and professionals in finance, marketing and design.

The rest of Motorola, called Motorola Solutions, is based in Schaumburg and makes bar-code scanners, public safety radios and radio-frequency identification readers.



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