Amazon invests in coupon company LivingSocial

NEW YORK Thu Dec 2, 2010 6:44pm EST

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NEW YORK (Reuters) - Inc is investing $175 million in online coupon company LivingSocial, a preemptive strike against Google Inc which a source has said is looking to buy Groupon, another coupon provider.

LivingSocial said on Thursday it also secured an $8 million investment from Lightspeed Venture Partners, adding that it will use the funds to grow its business worldwide.

LivingSocial said it is currently booking revenues of more than $1 million a day on average and expects well over $500 million in 2011.

Rival Groupon does not reveal financial figures, but its daily e-mails about discounts for goods and services has become an online phenomenon and the company is considered one of the fastest-growing Internet startups. LivingSocial also offers customers deals on local restaurants and spas.

Search engine leader Google is talking to Groupon about an acquisition, a source familiar with the situation said on Wednesday.

Amazon has been on an acquisition spurt in recent months, snatching up the parent of its smaller competitors and for $500 million, and online store for an undisclosed sum earlier this summer.

Amazon purchased popular online shoe seller last year for roughly $1.1 billion.

(Reporting by Ritsuko Ando and Alex Dobuzinskis; Editing by Phil Berlowitz and Tim Dobbyn)

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