Saturday, 17 February, 2018

Richemont makes an offer to buy YNAP shares for 38 euros each

Richemont Makes $3.4 Billion Offer to Take Over Yoox Net-a-Porter Richemont offers €2.8 billion to buy Yoox Net-A-Porter
Nellie Chapman | 23 January, 2018, 14:44

Richemont has also stated that Yoox Net-a-Porter will continue to operate as an independent company after the deal.

Richemont has announced its intention to acquire the 75% of Yoox Net-A-Porter (YNAP) voting shares that it does not presently own in a deal valued at €2.8 billion.

Yoox Net-a-Porter (YNAP.MI) shareholder Renzo Rosso believes Richemont's (CFR.S) bid for full control of the online retailer is of great value, even though he is sorry to see another renowned Italian brand pass under foreign control. Well that online retailer is about to become the most dominant player in the e-commerce marketplace thanks to a new takeover bid from Swiss-based conglomerate, Richemont - the luxury goods holding company which carries big ticket names like Burberry, IWC, Cartier and a host of other iconic brands in its portfolio.

Richemont, who like many peers in the luxury industry has been slow in pushing online sales, offered €38 per share for YNAP, an nearly 26 per cent premium to the e-commerce portal's closing price on Friday. It also owns nonvoting shares that give Richemont almost 50% of the e-commerce firm's overall equity.

"With this new step, we intend to strengthen Richemont's presence and focus on the digital channel, which is becoming critically important in meeting luxury consumers' needs", said Richemont's chairman, Yohann Rupert. Revenue in 2017 was EUR2.1 billion, up 15% on the year at constant exchange rates.

By 1200 BST, Yoox Net-A-Porter shares were trading 24.26% higher at €37.60. Luxury conglomerate LVMH Möet Hennessy Louis Vuitton has started its own e-commerce site. Chinese consumers have been major drivers of the luxury goods business.

"Given the lack of interesting acquisition targets up for sale in their core business of hard luxury, Richemont has chose to put at work its big cash pile investing into distribution channels", said Mario Ortelli, an analyst at Bernstein in London.

If the deal is finalised, YNAP will continue to be run as a separate company with Marchetti at the helm.