Richemont announced Tuesday that it will merge its online only luxury marketplace Net-a-Porter, which sells fine jewelry along with clothes and accessories, with Yoox, in an all share transaction that will afford Richemont a 50 percent stake in the combines entity.
Yoox, owned by the Milan based mail order retailer Yoox Group, is a similar business to Net-a-Porter. It is an online retailer of high end, brand name, fashion goods.
Richemont Chairman Johann Rupert said while the company is proud of Net-a-Porter’s achievements, merging it with another leader in online luxury sales was necessary.
“Established business models are being increasingly disrupted by the technological giants,” he said, perhaps referring to Amazon.com, which is trying to gain a foothold in the luxury market and once was rumored to be interested in buying Net-a-Porter. “It is with this in mind that we believe it is important to increase leadership and size to protect the uniqueness of the luxury industry.”
While Richemont, a Geneva based luxury goods conglomerate that also owns Van Cleef & Arpels, Cartier and a number of high end watch brands, will receive 50 percent of the share capital, the company’s voting rights will be limited to 25 percent to preserve the independence of Yoox Net-a-Porter Group, the proposed name of the combined entity.
It will continue to be incorporated in Italy, and listed on the Borsa Italiana, the country’s main stock exchange.
The merger is conditional upon the approval of Yoox shareholders, at a meeting expected to be held this June.
Richemont said upon completion, it will appoint two representatives to the company’s board of directors, which will have a minimum of 12 members.