Groupon's new 12,000 sq. ft. Silicon Valley office is located in the California Avenue neighborhood of downtown Palo Alto. Previously serving Groupon's Data and Mobile needs, the Palo Alto office will expand its scope of work to collaborate with the Chicago development team on all product technology. Palo Alto staff is slated to grow from 25 people to more than 100 within the next year. Groupon will also continue to expand its existing product team at Chicago headquarters, giving the company two regions from which to attract top recruits.

"Unfortunately we cannot comment on speculation or rumors about our business," said Andrew Mason, founder and chief executive officer of Groupon, for some reason.

The acquisition of Ludic Labs (http://www.ludic-labs.com) further builds the strong development and leadership talent at Groupon. Ludic Labs is best known for development of local marketing services including Offer Foundry, a self-service advertising and deals platform for local businesses; and Diddit, an online community connecting millions of users with targeted local attractions and interests. Over the last decade, the team behind Ludic Labs has built some of the world's largest Internet search and networking services.

The Ludic Labs team includes Paul Gauthier, who was co-founder of Inktomi in the Internet search market, and David Gourley who was chief technology officer at Endeca in the commerce and business intelligence area. As a part of the acquisition, Dr. Brian Totty, chief executive officer of Ludic Labs, will take on the role of head of engineering for Groupon, overseeing international product development and innovation. Terms of the acquisition were not disclosed.