KKR In Talks To Acquire Stake In Groupon-Owned Ticket Monster [REPORT]

KKR In Talks To Acquire Stake In Groupon-Owned Ticket Monster [REPORT]
By GrouponRUS (Own work) [CC BY-SA 4.0], via Wikimedia Commons

Groupon is reportedly planning to sell a major stake in its South Korean unit to KKR & Co, a private equity firm. According to a South Korean newspaper, KKR along with Hong Kong-based Anchor Partners are in talks to acquire 51% stake in the e-commerce company Ticket Monster for almost $316.5 million.

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Talks in final stages

The deal is reportedly in the final stages of negotiations, and is being managed by local branch of Deutsche Bank AG, Korea Economic Daily reported.

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Ticket Monster, locally known as TMON, was offered for sale in last October as its owner Groupon found it expensive to run in a very competitive market with two domestic rivals — Coupang and WeMakePrice. During the initial sale process, many South Korean companies, including LG Uplus Inc, showed an interest in buying the e-commerce site.

Ticket Monster, since its inception by Daniel Shin in 2010, has had great success in its initial years as the first deal-of-the-day site in the country. In 2013, Groupon bought the complete stake in the e-commerce company from Living Social Inc., a U.S. online marketplace operator, for $360 million. Though, just after a year, Groupon started seeking a buyer to sell either a partial or major stake in Ticket Monster.

Groupon gaining investors’ confidence

Short interest for Groupon was down in March. From 73,300,555 shares as on February 27th total, the short interest for the company dropped 5.9% to 68,986,170 shares as of 13th March. Approximately, 14.6% of the company’s stock is sold short.

Many analysts have come out with their verdict on Groupon in recent weeks. Analysts at Vetr, in a research note last week, raised the rating on the stock from Hold to a Buy, and assigned it a price target of $8.71. In a research note on March 25, Wunderlich analysts upgraded the company from Hold to a Buy, and raised the price target from $6.00 to $10.00. In a research note on March 19th, TheStreet raised the rating on Groupon from Sell to a Hold. Separately, in a research note on March 18th, Deutsche Bank reiterated a Buy on the stock with a price target of $8.50. Currently, Groupon has an average rating of Buy and an average price target of $9.03.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com
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