NEW YORK ( TheStreet) -- In what could have been Google's ( GOOG) largest acquisition to date, the deal to buy local daily deal startup Groupon looks like it isn't going to happen.

Citing sources close to the situation, Chicago Breaking Business reported Friday evening that Groupon, based in Chicago, opted to remain private and rejected the offer made by Google, which was rumored to be as high as $6 billion.

Chatter about the potential deal, in the works for weeks, escalated Tuesday and caused a maelstrom of speculation for other local-oriented companies, boosting stock prices for public local firms Friday and coinciding with eBay's ( EBAY) buy of and Amazon's ( AMZN) investment in Groupon rival LivingSocial.

For giants like Google, the appeal of Groupon and its rivals is their knowledge of locals' buying and searching habits -- valuable data as big, global firms move into smaller markets with targeted search and advertising.

Groupon, which offers customers a daily discount from local businesses, could be mulling an IPO, reported Chicago Breaking Business. Like Google, Groupon completed a series of its own acquisitions this week, buying three daily deal sites overseas and a technology company in California.

--Written by Maggie Overfelt in New York.

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