Richemont finds a buyer for YNAP with Mytheresa
Published: Monday, Oct 7th 2024, 15:30
Updated At: Tuesday, Oct 8th 2024, 01:59
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After a long search, the watch and jewelry group Richemont has finally found a buyer for its online fashion and accessories business Yoox Net-A-Porter (YNAP). YNAP is going to MYT Netherlands Parent B.V. (Mytheresa), in which Richemont will hold a stake in the future.
"We are delighted that we have found a good new home for YNAP," Johann Rupert, Chairman of the Board of Directors and majority shareholder of Richemont, was quoted as saying in the press release on the transaction on Monday.
Richemont had been looking for partners or a new owner for the loss-making YNAP for years. Just under a year ago, the sale to Farfetch fell through. The financially ailing British online luxury retailer was taken over by the South Korean e-commerce giant Coupang, which wanted nothing to do with YNAP.
Stronger together
Now Mytheresa is joining the fray. The digital platform sells clothing and accessories from well-known luxury brands such as Bottega Veneta, Dolce&Gabbana, Gucci and Moncler. Originally founded as a boutique in Munich in 1987, the company is listed on the New York Stock Exchange.
The merger offers great growth opportunities in the rapidly growing online luxury goods market, Mytheresa CEO Michael Kliger said in a telephone conference. The two companies would complement each other well in terms of sales markets. In addition, YNAP could benefit from the Mytheresa technology infrastructure.
The luxury division of YNAP is to be integrated into Mytheresa in the medium term, according to the statement. In future, the group will consist of the Mytheresa, Net-A-Porter and Mr Porter brands. The two platforms Yoox and The Outnet will be spun off separately, while the white label division, in which YNAP designs fashion for third-party customers, will be discontinued.
Richemont becomes a major shareholder in Mytheresa
Mytheresa currently generates over half of its sales in Europe, while YNAP has a strong presence in the USA. Kliger put the gross merchandise volume (GMV) of the two companies at currently around 3 billion euros. He wants to increase this to over 4 billion in the medium term, with an operating margin of over 8 percent.
However, YNAP still has some catching up to do in terms of profitability. This also explains the favorable purchase conditions for Mytheresa. The Group will acquire 100 percent of YNAP, which is debt-free and has 555 million euros in cash. Richemont will also grant a credit facility of 100 million euros.
In return, Richemont will receive shares in Mytheresa. Upon completion of the transaction, which is expected in the first half of 2025, the Geneva-based company will own 33% of Mytheresa and will be entitled to one seat on the Board of Directors.
All in all, the write-down requirement on the YNAP values in Richemont's books remains high. The Group anticipates a write-down of around 1.3 billion euros. However, this figure could still change depending on how the Mytheresa share price or the dollar/euro exchange rate develops, it said.
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