Yoox ties up with Net-A-Porter in €2.8bn merger
ITALIAN Fashion retailer Yoox announced it would be merging with designer clothing website Net-A-Porter yesterday, in an all-share deal set to create the world’s largest online luxury clothing outlet.
The new entity, Yoox Net-A-Porter will have combined sales of €1.3bn (£942m), with Net-A-Porter owner Richemont having a 50 per cent stake in the new firm. The current market cap of Yoox is around €1.3bn, while analysts estimate Net-A-Porter to be worth €1.5bn.
Net-a-Porter founder Natalie Massanet is reportedly set for a €70m windfall from the deal.
Richemont’s stake will not translate into proportional voting rights, to be capped at 25 per cent, effectively leaving Yoox in charge of operations.
Richemont, advised on the transaction by Nomura and Lazard, will also appoint two of the 12 board members at Yoox Net-A-Porter.
The online luxury goods industry only accounts for around five per cent of total luxury sales due to concerns at high-end brands that customer service would suffer as a result if they expanded online.
But the changing demographic of customers means many who now buy into these brands are well versed in online shopping, so many luxury designers are expanding online.
Following the merger, the new group is seeking to raise €200m in a new rights issue to fund expansion.
However, Richemont’s 50 per cent stake will remain unaffected.
The firm said it was committed to a three year lock-in period for half its stake.