SAN FRANCISCO (Reuters) - Andrew Mason will remain CEO of Groupon Inc (GRPN.O), a company spokesman said on Thursday after the board of directors decided to retain the company co-founder as head of the struggling online marketer of daily deals.
Shares of Groupon, which fetched $20 in its Wall Street debut last year, slid almost 4 percent to $4.36 in after-hours trade. The stock had jumped a day earlier, when Mason said he would fire himself if the board decided on that step at its regular Thursday meeting.
After the meeting concluded, spokesman Paul Taaffe said Mason was staying on as CEO Of the company that has been struggling to jump-start a faltering international business and revive the sputtering growth of its daily deals.
“The board and the management team are focused on the performance of the company and they are all working together with heads down to achieve Groupon’s objectives,” Taaffe said in an emailed statement without elaborating.
Wall Street has cooled on the five-year-old Internet company once touted for transforming local business advertising by marketing Internet discounts on everything from spa treatments to dining.
Some analysts have also questioned whether Mason has enough business experience to run a company that grew very quickly and now has thousands of employees across the globe.
Investors have grown uneasy about Groupon as fever for daily deals has cooled among consumers and merchants. Europe has been a particular problem as its debt crisis has sapped demand for higher-priced deals and as merchants have balked at steep discounts Groupon had offered there.
Groupon and rivals in the daily deals business, like Amazon.com-backed (AMZN.O) LivingSocial, have been forced to revamp their business models as daily-deal fever waned. LivingSocial cut almost 10 percent of its staff on Thursday.
Groupon’s efforts to reduce reliance on plain vanilla deals include bumping up its “Goods” retail business, increasing the selection of “persistent” or long-running deals, and allowing users to search for such deals on demand. Shares in the company surged 12 percent on Wednesday, after Mason’s publicly broadcast interview at the Business Insider “Ignition” conference in New York.
Analysts said Mason’s upfront demeanor and stated willingness to do what was right for the company — including stepping down — impressed some investors.
“If I ever thought I wasn’t the right guy for the job, I’d be the first person to fire myself,” he said during the interview on Wednesday.
Reporting by Alistair Barr; Editing by Gary Hill and David Gregorio