How Groupon Escaped Bankruptcy

more+
less-

Groupon recently escaped having to file for bankruptcy when the company listed its initial public offer (IPO) at $20. With the successful listing, Groupon will not have to file for bankruptcy, at least this quarter. The company’s liabilities as at the end of September amounted to $505 million, which was more than twice the $243 million cash they had in their kitty. Out of that amount, they owed $465 million to their own merchants for whom they sold Groupons, their half price coupons.

Just after the start of listing, the price of Groupon shares rose to $31 but thereafter fell rapidly. Anyone who bought at higher than $30 would have likely gotten burned. Even the underwriters knew the flaws of the company but agreed to underwrite anyway because they needed the fees due to the recession. These included Goldman Sachs, Credit Suisse and Morgan Stanley. Even with such a large group of 11 lead underwriters the deal had to be cut back to 5% of the shares outstanding to get it sold.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Tampa Bay Bankruptcy Center, P.A. | Attorney Advertising

Written by:

more+
less-

Tampa Bay Bankruptcy Center, P.A. on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×