A number of Groupon Inc. investors and some outsider activist groups are vying for influence in the company by either boosting their stake or aligning with major shareholders, particularly those who are dissatisfied with the company's strategy of increasing valuation by growing subscriptions, The Wall Street Journal reported Aug. 29, citing sources familiar with the matter.
Groupon's share value has been declining steadily since it went public in 2011. The company today is valued at about $1.4 billion, far below its $16.5 billion market value at the time of its IPO.
The activist investors reportedly want Groupon to consider a strategic partnership, a share buyback or the sale of the whole company. A number of shareholders are open to an activist campaign, the newspaper said, but it said talks are still at an early stage and there is no agreement yet.
Chapman Capital L.L.C. founder Robert Chapman told the Journal that he is trying to unite shareholders to pressure Groupon to sell itself or at least repurchase shares worth $100 million to boost its share price. Chapman holds 10 million shares or around 1.5% of Groupon's stock.
During its latest earnings call, Groupon said it has bought back more than $900 million of its stock over the last four or five years. For the second quarter ended June 30, the company repurchased 4.2 million shares for $15 million.
A Groupon spokesperson told WSJ that it is open to communicating with its shareholders but declined to comment on "rumor, speculation or hypothetical situations."
Shares in the daily-deals platform dipped 2% to $2.44 on Aug. 30 following the report.
