Richemont gets EU green light for sale of Yoox-Net-A-Porter to Farfetch

Luxury goods giant Richemont has obtained the green light from the European Union for the sale of its stake in Yoox Net-A-Porter (YNAP) to British online retailer Farfetch, a major transaction that redefines the landscape of the online luxury goods industry.

 

Swiss luxury giant Richemont has taken a crucial step forward with the European Commission’s approval for the sale of its 47.5% stake in Yoox Net-A-Porter (YNAP) to UK-based Farfetch. Monday’s announcement by Richemont illustrates the changing landscape of luxury e-commerce.

 

Richemont, owner of prestige brands such as Cartier and Chloé, expects to receive between 53 and 58.5 million ordinary A shares in Farfetch, or around 12-13% of the British company’s capital, in exchange for its stake in YNAP.

 

This five-year partnership between Richemont and Farfetch also implies that Richemont will receive $250 million in Farfetch shares.

 

Strategic agreement

 

Farfetch has the option of buying back all of Richemont’s shares in YNAP within five years, through a system of put and call options. At the same time, the investment company Symphony Global will acquire 3.2% of YNAP.

 

On completion of the initial phase of this transaction, YNAP will be debt-free, with at least $290 million in cash on its balance sheet. Completion of this transaction is subject to certain additional conditions to be met by Richemont and Farfetch, and a further update will be provided as soon as possible, according to Richemont.

 

In addition, Richemont will grant YNAP an additional ten-year credit line of $450 million.

 

Richemont’s agreement to sell a stake in loss-making YNAP was unveiled in August 2022 and led the Swiss group to book an impairment of €2.7 billion ($2.9 billion).

 

Farfetch in difficulty

 

The operation was complicated by Farfetch’s financial difficulties. The US-listed company has seen its shares lose more than 90% of their value over the past two years, with its market capitalization falling from $26 billion to just over $1 billion.

 



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Featured photo : ©Farfetch

Picture of Hugues Reydellet
Hugues Reydellet
Hugues Reydellet is a young and passionate journalist whose favorite subjects are economy, culture, gastronomy, but also cars, and sports. With a sharp pen and an insatiable curiosity, Hugues is constantly on the lookout for new hot information to report.

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