I like group work because it gives the students a reason to talk to each other -- in the process of getting some academic task accomplished they also have a chance to get to know other kids that they only know as acquaitences in class. I also like that group activities force the kids to justify their thinking. If a student works in isolation he just writes down his answer. In a group, he has to explain his answer and work with other people explanations in order to come to a group consensus.
Group work also helps students to interact in a way they might not do so otherwise. This pushes them out of their comfort zone a bit, which is a good thing. It helps them to see that others have knowledge and skills that can make a contribution to the whole, and it helps them learn how to get along with all the diverse people in the world.
Another advantage to groups is that they can allow a class to cover more ground, with jigsawing, for example, or assigning groups to cover and present different chapters of a text.
It also helps to give each student more of a chance to really interact with the material. In a large class, most students will just be sitting there, not really having to think about what is going on as the teacher talks. But if you break into small groups and assign some sort of activity, then more people have a chance to participate.
The pros of using groups in large classes helps to insure that students who actually grasp the information being taught can be relayed to those who are struggling. In classes with large numbers of students, sometimes teachers simply do not have the time to give the individual attention some students who need it. Group work, therefore, helps to alleviate some of the gap between comprehension of some lower level learners by the higher level learners helping to instruct.