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Groupon (NASDAQ:GRPN) top executives will not sell company stock after a trading lock-up period ends on June 1. The company’s founders, including chief executive Andrew Mason are planning to keep their shares even after the expiration of the lock-up that will allow some pre-initial-public-offering investors to sell shares.
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“We have no intention to sell,” Mason said during a webcast of an investor meeting on Thursday. “We see this as a long-term business.”
The approach of the expiration had put Groupon’s troubled stock under additional pressure, and Mason’s comments received a positive reaction from industry experts. “To hear that a third of the shares are not going to be sold is somewhat encouraging,” Benchmark analyst Clayton Moran told Reuters.
Mason added that he was hoping two new board members would provide “additional financial firepower” to help Groupon fulfill its responsibilities as a public company. Groupon had been under fire from analysts and investors after announcing there had been accounting errors in its earnings report from the fourth quarter of last year and changed an earlier profit to a loss. It had said then that it had set aside inadequate amounts in reserve for customer refunds and that there was a “material weakness” in its financial controls.
But late last month, Groupon named Daniel Henry, the chief financial officer of American Express (NYSE:AXP), and Deloitte’s Robert Bass as new members of its board of directors. Both will serve on the audit committee along with Ted Leonsis. Henry will replace Starbucks (NASDAQ:SBUX) chief executive Howard Schultz, who left the board.
Mason also said that the company was hoping to cut marketing spending, partly by automating its return-on-investment calculations. “Most of our innovation has been delivered on merchant and customer value. Now we are turning our technological innovation inward,” he said.
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