Richemont offers €38 a share to take over Yoox Net-a-Porter

Swiss luxury goods group Richemont has offered to buy the shares in Yoox Net-a-Porter it does not already own.

Richemont has offered €38.00 for the 75% of shares it does not already own, which represents a premium of 25.6% to the closing price of Yoox on Friday. The company said it plans to finance the cash consideration from existing cash resources and/or third part debt. It has entered into a bank facility with Goldman Sachs to provide backstop financing for the offer.

Chairman Johann Rupert said: "We are very pleased with the results achieved by Yoox Net-a-Porter’s management team, led by Federico Marchetti, and we intend to support them going forward to execute their strategy and further accelerate the growth of the business. Thanks to our long-term commitment and resources, we see a meaningful opportunity to strengthen further Yoox Net-a-Porter's leading positioning in luxury e-commerce, growing the business in existing and new geographies, increasing product availability and range, and continuing to develop unparalleled services and content for today’s highly discerning consumers.

"As part of our group, Yoox Net-a-Porter would continue to operate as a separate business, ensuring it remains a neutral and highly attractive platform for third party luxury brands."

RBC Capital Markets said the strategic logic of the deal is relatively straightforward.

"YNAP ownership enhances the long-term growth profile of Richemont’s group with a leading luxury e-commerce platform (Richemont is currently investing to expand in e-commerce, especially for watches and its soft luxury maisons, which are playing catch-up versus Cartier/Montblanc).

"Richemont’s scale and investment firepower provide YNAP additional resources to strengthen its business against a backdrop of intensifying competition in the luxury e-commerce space."

Kepler said that from a long-term strategic perspective, the deal makes sense. "Richemont had been looking for partners in the luxury sector to take stakes in Yoox so it could become the main industry platform. However, other luxury goods players were not interested. We expect online to become a key driver for the luxury good sector going forward."

At 0940 GMT, Richemont shares were down 1.1% to CHF89.08 and Yoox was up 24% to €37.62.