Groupon has agreed to sell a controlling 46 percent fully diluted stake in Ticket Monster (TMON). TMON is Groupon’s South Korean e- commerce site. The Groupon shares are worth $360 million and were sold to a partnership between KKR and Anchor Equity Partners with offices in Hong Kong.
The investments valued the Korean e – commerce site at $782 million on a fully diluted basis, assuming a full vesting of management’s 13 percent stake. At closing, Groupon will retain a fully diluted 41 percent stake in TMON. Groupon’s gain on the sale is expected to be between $195 million and $205 million which are values on a pre-tax basis and will be recorded at the close of the transaction. According to the transaction, Groupon will receive $285 million in cash; the remaining amount will be paid to TMON. Groupon acquired TMON in January 2014 for $260 million.
Eric Lefkofsky, Groupon CEO said in an interview about the sale “As the Korean market developed, it became obvious that TMON would benefit from additional resources and local expertise in its drive to be the leading social commerce company in Korea,” he added “We looked forward to watching TMON’s success as a continued large shareholder in the company.”
The TMON sale is expected to close in the second quarter of 2015, subject to regulatory and customary closing conditions. On the other hand, Groupon intends to use the proceeds from the sale for general corporate purposes and share repurchases. Groupon will report results for its 2015 first quarter on May 5, 2015.
Further information about the transaction will be reported on the coming weeks as well as included in Groupon’s report for its first quarter performance in May.
Groupon is a deal-of-the-day website that provides information on discounted gift certificates that are honored locally. Groupon was launched in November 2008, and the first market for Groupon was Chicago, then Boston, New York City, and Toronto. By October 2010 Groupon served more than 150 markets in North America and 100 markets in Europe, Asia, and South America, and had 35 million registered users. The idea for Groupon was created by now-ousted CEO Andrew Mason. The idea subsequently gained the attention of his former employer, Eric Lefkofsky, who provided $1 million in “seed money.” Groupon stock market evolution. http://www.marketwatch.com/investing/stock/grpn
About Eric Lefkofsky
Eric Paul Lefkofsky is a U.S.-born entrepreneur. He is co-founder and CEO of Groupon, co-founder of Lightbank founder & director of InnerWorkings Inc., Echo Global Logistics, Inc., Mediaocean. In March 2011, Eric was named one of the new millionaires in 201 by Forbes.
Ticket Monster (티켓몬스터) is a Korean e-commerce platform that provides customers with a wide range of daily deals. It caters to the needs of over five million people and employs about 850 workers all over the world. Ticket Monster offers deals on a wide range of products and services, such as food and beverage, clothing, accessories, cosmetics, personal care, consumer electronics, home appliances, kitchenware, sporting goods, and travel and tour offers. Ticket Monster was founded in February 2010. On January 2, 2014, it was acquired by Groupon, a global leader in local commerce. – See more at: https://www.crunchbase.com/organization/ticket-monster-korea#sthash.tYWgvMnm.dpuf
KKR & Co. L.P. (formerly known as Kohlberg Kravis Roberts & Co.) is an American multinational private equity firm, specializing in leveraged buyouts, headquartered in New York. The firm sponsors and manages private equity investment funds. Since its inception, the firm has completed over $400 billion of private equity transactions and was a pioneer in the leveraged buyout industry. The firm was founded in 1976 by Jerome Kohlberg, Jr., and cousins Henry Kravis and George R. Roberts, all of whom had previously worked together at Bear Stearns, where they completed some of the earliest leveraged buyout transactions. Since its founding, KKR is headquartered in New York City with 13 additional offices in the United States, Europe and Asia. In October 2009, KKR listed shares in the company, through KKR & Co. an affiliate that holds 30% of the firm’s ownership equity, with the remainder held by the firm’s partners. In March 2010, KKR filed to list its shares on the New York Stock Exchange (NYSE), with trading commencing four months later, on July 15, 2010. KKR stock market evolution: http://www.marketwatch.com/investing/stock/kkr
About Anchor Equity Partners
Anchor Equity Partners is a private equity firm specializing in middle market and consolidation investments. It targets investing in growing opportunities in Korea. Anchor Equity Partners was founded in August 2012 and is based in Seoul, South Korea.