The Yoox Group said on Tuesday that it agreed to merge with its luxury e-commerce rival company Net-a-Porter in an all-share deal. This would create an online luxury fashion retailer with a combined to post revenue of 1.3 billion euros, or about $1.4 billion. The new company would be called Yoox Net-a-Porter Group.
“This is a game-changing merger between two pioneering companies that have already radically transformed the marketplace since 2000 and will now shift the industry paradigm once again,” Federico Marchetti, the founder and chief executive of Yoox, said in a news release. “Together, we plan to expand on our many combined successes and industry breadth to strengthen partnerships with the world’s leading luxury brands and harness a significant untapped growth potential.”
Net-a-Porter’s website sells clothing, jewelry, shoes and accessories from top designers and labels which includes Alexander McQueen, Dolce & Gabbana and Valentino. It also publishes Porter magazine that allows readers to buy featured items. On the other hand Yoox sells off-season luxury goods in its online store and from thecorner.com.
In an interview by telephone from Milan, Mr. Marchetti said that he admired Net-a-Porter’s editorial skills. These would improve Yoox’s business building and operating websites for luxury brands. Yoox already powers sites for more than 30 brands, including Armani, Zegna, Lanvin and Valentino, and has a joint venture with Kering for many of its luxury brands including Bottega Veneta, YSL and Alexander McQueen. Mr. Marchetti would serve as the chief executive of the combined company, and Natalie Massenet, the founder of Net-a-Porter, would be its executive chairwoman.
“Today, we open the doors to the world’s biggest luxury fashion store,” Ms. Massenet said. “It is a store that never closes, a store without geographical borders, a store that connects with, inspires, serves and offers millions of style-conscious global consumers’ access to the finest designer labels in fashion.”
According to the deal, Richemont would receive 50 percent of the combined company’s shares and hold 25 percent of its voting rights. Richmond would also be limited to two of the company’s 12 independent directors. To remember, Richemont acquired a majority interest in Net-a-Porter in 2010 in a deal that improved the company’s value at 350 million pounds, or about $519 million. Analysts said the merger will call for further consolidation in the luxury retail sector.
The transaction is subject to regulatory and shareholder approval and is set to close in September. Yoox would still be listed in Milan and based in Italy. If the transaction is completed, the combined company will raise up to €200 million in capital to fund future growth opportunities.
YOOX Group S.p.A is an Italian internet mail order retailer of men’s and women’s multibrand clothing and accessories. Founded by Federico Marchetti, a former investment banker, in Zola Predosa, Yoox Group has become an e-commerce company that serves more than 100 countries worldwide. Yoox stock market evolution: http://www.reuters.com/finance/stocks/overview?symbol=YOOX.MI
About Federico Marchetti
Federico Marchetti is the founder and CEO of YOOX Group. After finishing an MBA at Columbia and a brief career in finance and consulting, he developed Internet retailing company Yoox in 2000 in Zola Predosa. Marchetti took YOOX Group public in 2009 on the Borsa Italiana (Milan Stock Exchange). It was the first European tech company to do so since the economic downturn of that period. YOOX Group opened its first offices in China in 2010 in the city of Shanghai. In 2011, Marchetti was given an award for Innovation and Internet by the Italy-based Chi è Chi (Who’s Who) organization. On January 25, 2012, Marchetti and YOOX Group were awarded the Comitato Leonardo’s Premio Leonardo award for innovation by Giorgio Napolitano, President of Italy.
About Net –a – Porter
Net-a-Porter is a high-fashion retailer that online designed in the style of a magazine. It was launched in London in June, 2000 by Natalie Massenet. It now operates globally with multiple fashion retailing sites and some 2,600 employees. It is part of the Swiss holding company Richemont. The website has 2.5 million unique visits in Internet traffic to their website every month.
About Natalie Massenet
Natalie Massenet MBE is a fashion entrepreneur, former journalist and founder of fashion portal Net-a-Porter. Since 2013, she has been chairman of the British Fashion Council. Credited by many as changing the way designer fashion is retailed, she has been described as: “fashion’s favorite self-made success story” by The Observer. Massenet received an MBE for services to the fashion industry in 2009. In 2013, Massenet was made a Woman of the Year by US Glamour magazine. In 2014, she was named as one of the 100 most influential people by Time.