E-commerce

Richemont, owner of jeweller Cartier, said on Wednesday it would not inject any cash into online luxury retailer Farfetch, following a report that the latter was exploring going private.

Farfetch founder Jose Neves is considering the move after a troubled New York Stock Exchange listing for the loss-making British company, and is working with advisers at JP Morgan, the Telegraph newspaper reported on Tuesday.

The company, in which Neves has a stake of 15 per cent, declined to comment to Reuters on Wednesday.

Richemont, which has a deal in place to sell its Yoox Net-A-Porter online fashion and accessories business to Farfetch said it was “carefully monitoring the situation.”

It said it was reviewing its options around the deal, announced in August 2022, under which it will receive an initial 58.5 million Farfetch shares.

“Richemont would like to remind its shareholders that it has no financial obligations towards Farfetch and notes that it does not envisage lending or investing into Farfetch,” Richemont said in a statement on Wednesday.

Richemont shareholders appeared to laud the development, with Richemont stock gaining 1.6 per cent in early trading in Zurich.

Royal Bank of Canada said if Farfetch delisted, it could attempt to renegotiate or renege on the deal. Other analysts said it made a deal less likely to take place.

A person familiar with the matter said Richemont had “definitely no intention” of putting money into Farfetch, but declined to comment if a delisting would void the deal.

Still, Zuercher Kantonalbank analyst Patrik Schwendimann said Richemont’s statement showed the company was distancing itself from Farfetch and the transaction was now likely.

“There’s still a possibility for Plan A – a Farfetch deal to buy a 47.5 per cent stake in YNAP – but where that…


This is only a snippet of a eCommerce Article, please visit the Authors Website and Read the Full Article