Groupon is struggling and has in recent months shut down operations in Turkey, Greece, Morocco, Panama, The Philippines, Puerto Rico, Taiwan, Thailand and Uruguay. A pull-back that lead to over a thousand people being laid off.
Recently the company also announced its exit from the Nordic countries and Ukraine. The online deals website has lost 86 percent of its value since going public more than four years ago, but that has not stopped one of the world's largest e-retailers to invest in the company, Bloomberg reports.
According to a regulatory filing on Friday Alibaba Group bought 33 million shares, and as of 31st of December, the Chinese e-commerce giant owned 5.6 percent of the Chicago-based Groupon.
Part of a Bigger Plan
Alibaba has declined to immediately comment on the filing and Bill Roberts, a Groupon spokesman, said the company hadn’t been aware of Alibaba’s stake until Friday’s filing.
The acquisition of the 5.6 percent stake in Groupon as well as the purchase of stakes in online retailer Jet.com, augmented-reality provider Magic Leapvand and car-booking company Lyft are part of the company's strategy to learn more about the US market as it expands internationally, according to analysts.
– They don’t want to have their own operations, so they are investing in other companies to help them learn and pave the way for more robust activity down the road, says Gil Luria, an analyst at Wedbush Securities.