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According to sources close to the situation, Google has offered $5.3 billion for Groupon, in what would be its largest acquisition yet if completed.
Sources said the deal for the social buying site seemed likely to be struck, even as early as tomorrow, although it certainly could fall apart right up to the end.
But, if done, it will move the search giant instantly to the top spot in local commerce online and give it huge troves of data about consumer buying habits and merchant information across the globe.
Google has tried to capture a bigger share of local advertising dollars, but its primary product—paid links next to search results—is ineffective for the vast majority of small businesses, says Mr. Borrell. Few sell products or services online, so paid search doesn't pay. Groupon has proved more effective, sending customers through the front door. Buying Groupon could thus give Google a more successful way to engage with local merchants.
Google would also get email addresses and other personal information from Groupon users, which would enable it to provide more targeted, more lucrative advertising to them. Not to mention that Google might market Groupon deals to folks carrying cellphones powered by its Android operating system.
Part of the rationale of the deal has to be using Google's immense scale to expand Groupon's business, but that is easier said than done.
Google local / places marches on . Sayonara Yelp , local business listings and a lot of others ... Google can do it directly and create great earnings to pay for the acquisition i figure. It's not a lot of money considering the cash flows and profits it will generate in the deal.