Richemont merges YNAP with Farfetch, Alabbar in long-awaited deal

LONDON – Richemont has completed a long-awaited deal aimed at digitizing the luxury business, merging the Yoox Net-a-porter platform with Farfetch.

While the initial deal means the new, neutral platform does not currently have a majority owner, the deal will eventually see Farfetch acquire a majority stake in YNAP, subject to certain conditions.

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The luxury giant said on Wednesday that Richemont, Farfetch and Symphony Global, one of Mohamed Alabbar’s investment vehicles, had completed “a landmark transaction” with Farfetch and Alabbar acquiring a 47.5% stake and 3 .2% respectively. in YNAP.

The deal also sees Richemont and YNAP adopt Farfetch Platform Solutions, meaning the companies will sell their merchandise using Farfetch’s digital expertise.

“This represents an important step towards achieving Richemont’s vision of making YNAP an industry-neutral platform and, through a call and put option mechanism, paves the way for Farfetch to potentially acquire the remaining shares of YNAP, bringing in contact these highly complementary businesses. The partnership also marks a step change in Richemont Maisons’ multi-channel distribution capabilities,” Richemont said on Wednesday.

The luxury giant, which owns brands such as Cartier, IWC and Van Cleef & Arpels, said the partnership will mean Richemont and YNAP will leverage Farfetch’s technology platform to drive its Luxury New Retail programme.

In addition, YNAP will adopt Farfetch Platform Solutions to facilitate its shift to a hybrid retail-marketplace model.

Richemont will also use the Farfetch platform to drive the delivery of its maison’s omnichannel strategy, which will also be integrated into the Farfetch marketplace, enhancing, among other categories, Farfetch’s watch and jewelry offering.

Richemont said the Farfetch platform is “well-positioned to provide end-to-end capabilities for the luxury industry” and “envisions further collaboration on innovative technology solutions to be made available to luxury brands and retailers to meet the growing multi-channel demands of luxury customer”.

YNAP’s planned merger with Farfetch was announced by Richemont chairman Johann Rupert late last year and fulfills Rupert’s ambition to create a neutral platform for luxury digital sales while allowing Richemont to move forward without the YNAP business. which was a move at the bottom of the Richemont line.

Rupert said the announcement was a “significant step towards realizing a dream I first expressed in 2015 to create an independent, neutral online platform for the luxury industry that would be highly attractive to both luxury brands and their demanding clientele. We knew then that if we wanted to control our destiny and protect the uniqueness of the luxury industry as it digitized, we would have to work together as the task was too big to take on alone.”

José Neves, founder, president and CEO of Farfetch, said his company “is excited to acquire 47.5% of YNAP and to work with Richemont in transforming YNAP into a hybrid business model that we believe will lead to strong growth and profitability for YNAP. This investment and the work we will do with Farfetch Platform Solutions for YNAP will pave the way for a potential acquisition by Farfetch, which will create a complementary portfolio of iconic luxury destinations, appealing to different demographics, price points and regions .

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