Richemont: denies Farfetch rumors

(CercleFinance.com) - Richemont said on Wednesday that rumors claiming it intends to invest in Farfetch, or to finance the online luxury retailer, were unfounded.


Following reports in the press, the Swiss group recalls that it has 'no financial obligations towards Farfetch and notes that it has no plans to invest in or lend money to Farfetch'.

These statements come as Farfetch jumped almost 23% on the New York Stock Exchange yesterday amid rumors of a delisting, a project allegedly backed by Richemont and China's Alibaba.

Farfetch did not comment on the news, but the company announced that it would not publish its third-quarter results, as planned, today, adding that it planned to provide an update on the situation 'in due course'.

In its press release, Richemont states that it is closely monitoring developments in the case, which could lead it to review its options linked to the transaction concluded this summer with Farfetch.

For the record, the Swiss giant sold 47.5% of its Yoox Net-a-Porter (YNAP) subsidiary to the company in exchange for an equity stake.

'The possible delisting of Farfetch complicates the completion of the transaction', said RBC analysts in a reaction note this morning.

According to the Canadian broker, Farfetch could just as easily (1) oppose completion of the transaction as it stands, (2) ask to revise the terms, or (3) complete it as agreed.

Listed on the Zurich stock exchange, Richemont shares nevertheless gained 1% on Wednesday morning, making them the second-biggest gainer on the SMI index.

In a study, Oddo BHF's teams tempered the impact of a possible failure of the YNAP transaction: "it would not be ideal, but it would not radically change our opinion on Richemont", said the private bank.

Copyright (c) 2023 CercleFinance.com. All rights reserved.