Founded in Germany in 2009, Citydeal has a presence in more than 80 markets in 16 countries and employs more than 600 people. In the UK it operates as MyCityDeal.co.uk.
All the Citydeal sites are now expected to be rebranded under the Groupon banner.
Groupon was founded in 2008 and has 5m subscribers, whose collective power it uses to obtain daily discounts on different events, shops and restaurants. As a result of the deal, Groupon now says it now has a reach of 140 cities in 18 countries.
Groupon’s founder and CEO Andrew Mason, said: "Citydeal's rapid growth across Europe has proven that the Groupon model is truly global.
"By coming together, we are establishing Groupon as the company that not only invented, but now universally defines this new model of commerce."
Terms of the deal were not disclosed.