Groupon has raised $250 million in fresh investment from Comcast-backed Atairos.
As part of the investment deal, the two companies are planning on working together to build upon their local advertising platforms.
Groupon said it plans on using proceeds from the investment to fuel its growth and power its share buyback program. The Chicago-based company’s board of directors also announced a $200 million increase to its previous share repurchase budget, which has now been extended through April 2018.
“Our partnership with Atairos will help accelerate our transformation, while better positioning us to execute on our strategy and mission to build the daily habit in local commerce, which we continued to make progress on in the first quarter,” said Groupon CEO Rich Williams.
Comcast, on the other hand, is expected to benefit from the deal by leveraging Groupon’s resources to augment its local advertising business, “Comcast Spotlight,” which offers daily discounts for local businesses — a Comcast division that generated $2.3 billion in revenue last year, Bloomberg reported.
“Groupon is an established leader in connecting customers with local businesses,” said Neil Smit, president and CEO of Comcast Cable. “The potential in combining Groupon’s local expertise with Comcast’s vast subscriber and advertiser network is something we look forward to closely exploring together.”
Following the deal’s arrangement, Atairos CEO Michael J. Angelakis will join Groupon’s board of directors. Angelakis, who founded Atairos with Comcast to help the Internet giant grow its investment portfolio, is reportedly investing over $40 million using personal funds. Currently, Atairos holds a market value of about $4.1 billion, with a $4 billion stake from Comcast.
Post-announcement, Groupon’s share value rose by 16 percent and closed at $4.53 yesterday (April 4). Last Friday, the company saw its stock value climb by 28 percent.