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Farfetch received one of the largest investments ever. The luxury fashion platform led by Portuguese José Neves will benefit from a total injection of $ 1.15 billion (€ 983.3 million), according to the statement released Thursday. The Chinese of Alibaba, the Swiss of Richemont and the French of Artémis are the companies involved in this operation.
The budget for this injection is split on three fronts: the issuance of 10-year convertible bonds with Alibaba and Richemont (US $ 600 million); the creation of a new company for the Chinese market only (US $ 500 million); and the purchase of shares (50 million euros)
The e-commerce giant Alibaba is the main reference in this release. It will embrace Farfetch’s luxury fashion sales channels on its platform, opening the door to potential 757 million consumers.
Farfetch’s operations in China will be under the company Farfetch China. With a founding date scheduled for the first half of 2021, it will see Alibaba and the luxury fashion conglomerate Richemont as shareholders, in a joint position of 25% and which involved an investment of $ 500 million (250 million each). Three years after the founding of Farfetch China – expected, the two companies can activate an option to buy 24% of the shares in this company joint venture.
This Thursday’s announcement also includes the purchase of $ 50 million in shares by French investment group Artémis.
For José Neves, these innovations “are an important step in the mission of connecting curators, creators and consumers to the luxury fashion industry”. They are a “strong confirmation” of Farfetch’s position in this sector.
Alibaba group leader Daniel Zhang estimates that China “will be worth half of the luxury fashion sales by 2025”.
Thursday’s statement confirms Alibaba’s investment in Farfetch, which was reported on Tuesday by the tech portal The information.
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