Farfetch Shares Jump After Landing $1.15 Billion Investment
November 06 2020 - 11:44AM
Dow Jones News
By Robb M. Stewart
Farfetch shares jumped Friday after it struck a global
partnership with Alibaba Group and Compagnie Financiere Richemont
SA as part of a $1.15 billion investment in the fashion
retail-platform.
In morning trading, the stock was 14% higher at $42.99,
extending the year-to-date rally.
In a move unveiled Thursday, Alibaba will launch Farfetch
shopping channels on its Tmall Luxury Pavilion and Luxury Soho
marketplaces.
Chinese giant Alibaba and Swiss luxury company Richemont will
each invest $300 million in private convertible notes issued by
Farfetch, and $250 million apiece in a new joint venture that will
include Farfetch's marketplace operations in the China region. The
pair will buy a further combined 24% in Farfetch China after the
third year of the venture's formation, and said they will seek
additional opportunities to work with Farfetch to provide services
to luxury brands.
Separately, Artemis, the controlling shareholder of global
Luxury group Kering, agreed to increase its existing investment in
Farfetch with a $50 million purchase of Farfetch's class A
shares.
With the investment, Alibaba will nominate one director to
Farfetch's board.
On Friday, Wells Fargo raised its recommendation on Farfetch's
shares to equal-weight from underweight, with a target of $42 a
share.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
November 06, 2020 11:29 ET (16:29 GMT)
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