Luxury group Richemont has announced that it will not be proceeding with a planned transaction involving its Yoox Net-A-Porter platform and Farfetch. As a result, the company expects to incur losses on convertible senior notes that were previously issued by Farfetch.
This decision comes in light of the recent news that Coupang, a South Korean e-commerce company, is acquiring Farfetch’s business and assets. Last year, Richemont and Farfetch reached an agreement in which Richemont would divest nearly half of its e-commerce business, YNAP, in exchange for a minority stake in Farfetch and access to its platforms.
Richemont confirmed on Monday that it does not anticipate repayment of the $300 million convertible senior notes issued by Farfetch to the company in November 2020. As of November 30, 2023, the carrying value of these notes in Richemont’s accounts stood at EUR218 million.
Despite this setback, both Richemont and YNAP will continue to operate independently on their respective platforms. The company stated that it will re-evaluate its options for the sale of its e-commerce business.