Why Alibaba bought nearly 33 million shares of Groupon
With news of Alibaba's stake in Groupon, the e-commerce stock jumped more than 16 percent in Tuesday premarket trading.
With news of Alibaba's stake in Groupon, the e-commerce stock jumped more than 16 percent in Tuesday premarket trading.
Alibaba has bought nearly 33 million shares of online daily deal service Groupon.
Groupon Inc.'s stock jumped more than 16 percent in Tuesday premarket trading.
The purchase gives the Chinese e-commerce powerhouse about a 5.6 percent stake in Groupon. Alibaba disclosed the purchase in a SEC regulatory filing on Friday.
The news comes shortly after Groupon reported a fourth-quarter adjusted profit and revenue that beat analysts' expectations.
Why is Alibaba taking a major stake in Groupon? Forbes contributor Doug Young offers two possibilities. The first has to do with Alibaba selling a stake in a Chinese group buying web聽site Meituan-Dianping. It may want Groupon to expand into China.聽
Last month Alibaba Group Holding Ltd. reported better-than-expected third-quarter results as it benefits from a shift to mobile spending and a growth in users.
Shares of Chicago-based Groupon added 48 cents, or 16.6 percent, to $3.37 before the market open on Tuesday.