Groupon Buys LivingSocial, Rival Once Valued at $6 Billion

Groupon Inc. agreed to buy LivingSocial Inc., absorbing an old rival in the once-fierce war between companies offering daily deals via e-mail.

The acquisition didn’t impress Groupon investors, who sent shares down as much as 19 percent to $4.27 Oct. 27 despite an earnings report in line with analysts’ estimates and a more optimistic forecast for the rest of the year. The selloff marked the biggest intraday drop for Groupon in six months.

The amount of the purchase isn’t material, Groupon said Oct. 26, and the transaction should close next month. Amazon.com Inc.-backed LivingSocial had cut more than half its workforce ...